Bahir Dar University

College Of Business and Economics

Department Of Logistics and Supply Chain Management
A Report for Internship

COMMERCIAL BANK OF ETHIOPIA ARADA DISTRICT BUBA BRANCH

Supervisor’s Name :Asrat W/mariam

Department Advisor’s Name : Mandefro

The duration for this internship :45 days

Name : Meti Tesfaye

Id:1204681
 TABLE OF CONTENT
Page no.

Executive summary……………………………………………………………………………………….1
Acknowledgement…………………………………………………………………………………………2
Chapter one: over view of the organization
1.1 Background of Commercial bank of Ethiopia……………………………………………3
1.2 Hierarchical structure…………………………………………………………………………….4
1.3 Vision ,mission ,core values , hierarchical structure………………………………….5
Chapter two: major activities done in CBE
2.1 Services given in CBE………………………………………………………………………………..7
2.2 services given in CBE at Buba branch………………………………………………………..15
2.3 SWOT analysis………………………………………………………………………………………….18
Chapter three: practical experiences
3.1 Internship activities……………………………………………………………………………………19
3.2 problems ………………………………………………………………………………………………….20
3.2.1 problems I encountered during my internship…………………………………….20
3.2.2 problems I have seen at the branch level…………………………………………….20
3.3 strength I have seen at the branch…………………………………………………………….20
3.4 recommendation for the problems…………………………………………………………….21
3.5 conclusion…………………………………………………………………………………………………..22
References……………………………………………………………23
 Executive summary
The internship report outlines the duties at Buba branch Commercial Bank Of
Ethiopia submitted to department of Logistics and Supply Chain Management for
partial fulfillment of the requirement for degree program.
The main objective of this Internship is to determine how the theoretical courses are
applied on the real world. Besides this, it focuses on identifying problems and
opportunities facing the department. This report is divided in to three chapters. The
first chapter deals about the general overview of the bank which are history, back
groud etc. The second chapter deals with the major services given at the bank this is
the main focus area of my report. Here I have put some of the services given at the
bank in detail like deposit but mainly it declares the international trade services of
the ban. The bank plays major role in the import and export process of the country.
The 3rd and the last chapter is about my experiences gained at the internship and my
general view including the problems and recommendation given to the problems.
The bank is applying new technologies, so customers can get the services they need
without coming to the bank. There is a very close communication in the bank,
branches highly communicate with district and the head office and departments also
communicate very greatly, and this has led to a very tight control and as a result it
has prevented corruption and malpractices in the bank.
The bank is majorly contributing in the import and export of Ethiopia by providing
trade services and it is serving as fund for government purchasing its the banks’
capital that serves as a source of funds for the government’s purchasing. On the
other hand the bank’s operation is problematic in relation to the purchase and
delivery of goods because the purchasing in the bank is more centralized so most
materials are procured in the head office and at district.

1|Page
Acknowledgement

My internship would not have been possible without the guidance and help of
several individuals who in one or another contributed and extended their valuable
assistance in the preparation and completion of this internship.

First and foremost I would like to thank my God for his never ending grace, mercy,
and provision. I have extend my special thanks to Bahirdar university college of
business and economics for providing such kind of opportunity for students to
broaden our perception on how the real world in the field of logistics looks like.

I would like to express supreme gratitude to Ass. Prof. Hailu Abebe head of
department of LSCM for his effort to succeed this internship I extend my grateful
thanks to Mr Mandefro our advisor for his support.

My sincere thanks also goes to Mr. Asrat W/mariam for giving me the opportunity
to do an internship within the organization he is managing and all the individuals
who work in the branch. They were really helpful, they are willing to share their
knowledge to anybody that wants to learn.
Last but not least, I would like to thank my family specially my brother for his effort in
finding the company where I can do my internship.

2|Page
Chapter One
Overview of the organization
1.1 Back ground of CBE

In 1963 the Ethiopian government split the State Bank of Ethiopia into two banks,
the National Bank of Ethiopia (the central bank), and the Commercial Bank of
Ethiopia (CBE). In 1974, CBE merged with the privately owned Addis Ababa
Bank. The Commercial Bank of Ethiopia (CBE) is the largest commercial bank in
Ethiopia. It has been playing a significant role in in the development of the country.
As of June 2021, it had about 1.2 Trillion  Birr in assets and held approximately 67%
of deposits and about 53% of all bank loans in the country. Currently CBE has more
than 39 million account holders in it has more than 1838 branches and the number
of Mobile Banking users also reached more than 5.5 million as of June 30, 2022.
Active ATM card holders reached more than 7.7 million.

The bank has around 22,908 employees, who staff its headquarters and its over
1000+ branches positioned in the main cities and regional towns. The latter include
120 branches in the national capital Addis Ababa.

Money transfer companies working with CBE

Xpress money, trans fast, money gram, world remit, paco money transfer, ria money
transfer, money gram,

Introduction to CBE Buba branch

Buba ranch is found in Arada district with grade 1 the branch can be contacted by
+251951. Commercial bank of Ethiopia branches are open from Monday to Friday
8am to 5:30 earlier only selected branches were open on Saturday but now including
buba branch all branches gives service on Saturday from 8am to 5:30. Commercial
bank of Ethiopia buba branch was opened on 18/05/2017 with 15 employees. Now a
day it has 16 employees with 2 managers, 2, operation managers, 2, business
manager, 2 auditor, 2 senior managers, 2, cashier, and 6, tellers are there.

Hierarchical structure of CBE

3|Page
 Board of directors

Risk management Internal audit (v/p)

and compliance

President

Board and EMC

secretariat

Whole sale Interest Credit

Retail and Digital Customer Internatio
banking free
branch banking experience nal
banking
banking banking
(executive
v/p)

Human
Information resourse
system

The board of directors are members of the parliament

Hierarchical structure of CBE at the branch level

4|Page
 Manager

Manager
Business for branch
manager operations

Manager for
quality
management
and control

The number of officers and the hierarchies at branch level varies depending on the
level of the branches. Apparently, the branches of the Bank, under the new
structure, are designated as special and grade IV branch, grade III, II and I.

The new design places the 1,838 branches of the Bank into three broad regions with
ten districts each and 30 districts. The flatness of the structure is intended to bring
about quality and easiness of control with an end goal of realigning corporate values
towards the vision, the document professes.

5|Page
1.2 Vision, Mission and Values

Vision:
A world-class commercial bank financially driving Ethiopia's future..
MISSION
Committed to realize stakeholder’s values through enhanced financial inter-
mediation using the best professionals and technology.
CORE VALUE
- Integrity
-Service Excellence
- Professionalism
-Empowerment
-Innovative Organization
-Teamwork
-Respect for Diversity
-Corporate Citizenship.

6|Page
 Chapter Two
Major activities done at CBE

2.1 Services Given at CBE

Most of the work done by the bank is done with pre-built Microsoft access called
tellemenous and most of the information I wrote was not done by doing the actual
work, but by asking the manager and the staffs.

Major Products and Services

1. Deposit Products and Services

2. Credit Products and Services
3. International Trade Service
4. Electronic Payment Services etc

The services that I have mentioned above are the main services of the bank and we
will see all the services in detail and my major focus will be on the international
trade services of the bank which relates with logistical activities of the country
namely import and export process.

1. Deposit products and services

Saving account is an interest bearing(minimum 7%), deposit that CBE renders for
physical and legal persons (Individuals, organizations and associations) who can fulfill
the Bank’s requirement and are legal.

The Bank provides different deposit products and services that enable customers to
save money and store valuable property.

7|Page
Personal saving

 Ordinary saving account

 Women saving account
 Youth saving account
 Teen youth account
 Education saving account

Demand/current account
Demand Deposit Account (current or checking account) is a non-interest bearing
account and is opened or operated by literate customers only.

 Ordinary Demand Deposit

 Special-Demand Deposit Account

 ECX related Accounts

Fixed Time Deposit

This deposit account allows customers to deposit their money for agreed term
without movement and receive a higher interest rate than the prevailing interest
rate for savings. The minimum initial deposit is birr 10,000 or USD 5,000 or its
equivalent in EUR or GBP.

Foreign Currency Account

This account is opened in USD, GBP or EUR by international organizations,
foreigners, NGOs, embassies etc whose source of fund is overseas and in foreign
currencies.

Diaspora Account
This account is designed for Ethiopians and foreigners of Ethiopian origin living
abroad and companies owned by them to deposit money in USD, GBP or EUR.

8|Page
Safe Deposit Box
CBE gives rental service of safe deposit boxes for customers to store their valuable
property.

2 Credit products and services

Investment Loan

For investment loan, Commercial Bank of Ethiopia offers a wide range of options:

 Motor Vehicle, Construction Machinery, Agricultural Term, Partial Financing,

Syndicate, Term, and Idea Financing loans.
 Any group or individual who has/have a recognized, scientific invention/study
by the government of Ethiopia that deals with seeding innovative ideas,
(namely MINT).
 Once Intellectual Property Right Protection is obtained from the designated
office, the loan is then granted for those innovators to mass-produce their
ideas

Eligibility

 To be eligible for micro-finance loans by CBE, an institution should have an

excellent loan portfolio in terms of savings, loan approvals, best recovery
practices, and similar measures and indices.
 Micro-Finance Institutions should also ascertain that they are legally
registered with the National Bank of Ethiopia and abide by and meet all
relevant policies and directives of the National Bank of Ethiopia regarding:
 As a notice, such institutions must know that they are legally registered with
the NBE (AKA: National Bank of Ethiopia) and that they are following the
policies and commands of the NBE for: Reserve, Liquidity, Capital adequacy,
and Minimum paid-up capital requirements, and any other requirements set
by the National Bank of Ethiopia.

Working Capital Loan

Definition: is a loan that is taken to finance a company’s everyday operations. These

loans are not used to buy long-term assets or investments and are, instead, used to

9|Page
provide the working capital that covers a company’s short-term operational needs.
Working Capital loan within the Commercial Bank of Ethiopia policies includes:

 Import Letter of Credit Facility

 Pre - shipment Export Credit Facility
 Advance on Export Bills Facility
 Overdraft and overdraw Facility
 Merchandise Loan Facility
 Overdraw
 Import Letter of Credit Settlement Loan
 Revolving Export Credit Facility
 Letter of Guarantee Facility

Pre-Shipment Export Credit Facility

Pre-Shipment Export Credit Facility is a short-term, one time or revolving loan

facilities extended for the purchase of export materials, processing and converting
into finished goods, warehousing, packing, and transporting the goods until the time
of shipment, upon presentation of valid sales contract and irrevocable export letters
of credit or otherwise depending on relationship and credit history.

International Trade services

International trade: economic transactions that are made between countries.

The international trade Service is one of the core processes of the bank entrusted
with the task of international banking services. The services are now provided at all
branches of the bank with a single contact point of customer service relationship
officers assigned for this purpose only.

10 | P a g e
The commercial bank role in Ethiopia is to act as a government representative bank
directed to the larger company working with import, and export businesses.

There are five primary methods of payment in international trade that range from
most to least secure. Of course, the most secure method for the exporter is the least
secure method for the importer and vice versa. They key is striking the right balance
for both sides

Trade services of a bank can be:

 Documentary letter/letter of credit
 Advance payment
 Consignment basis payment
 Guarantee
 Documentary collection

Documentary letter/letter of credit

A Documentary Letter of Credit is a bank’s international payment instrument by

means of which a certain amount of money is made available to a Beneficiary (Seller)
by an Applicant (Buyer) through a Bank that becomes payable after certain terms
have been met.

It is a payment mechanism used in international trade to provide an

economic guarantee from a creditworthy bank to an exporter of goods. 

 A bank in the importing country issues an LC and sends it to the exporter. In order to
get LC from a bank an importer must provide set documents like invoice , certificate
of origin and transport ,an importer sometimes has to deposit cash with his bank or
provide collateral to obtain the LC.

COMMERCIAL BANK OF ETHIOPIA

Letter of Credit Application Form

1. APPLICANT NAME AND ADDRESS

Email Contact Number

11 | P a g e
 2. Tin No 3. Trade Licence No

4.Beneficiary Name

5.Beneficiary Address

6.Tel and Fax no

7.Advising Bank SWIFT code 8 Beneficiary City and

Country

9. Advising Bank Name:

10. Proforma Invoice No

11. LC Type Irrevocable: Confirmed Unconfirmed Transferable

12. Available by: Sight Negotiation Acceptance

Differed Mixed
13. LC currency _USD LC
Amount in figure LC Amount in words

14.Place of Expiry ___________Expiry Date Latest date of

shipment-----

15. Port of Loading Port of Discharge

16. Delivery Terms Final Destination

17. Partial Shipment: Allowed Not allowed Transshipment:

Allowed Not Allowed
18. Shipment to be Effected By: Ethiopian shipping ✔ Ethiopian air lines
Other

12 | P a g e
 19. All Bank Charges Outside Ethiopia are for account of: Beneficiary
Applicant

20. Descriptions of Goods

Document Required (Write the no. of Documents on the provided boxes)

21.Commercial Invoice: 2 signed original commercial invoices and copies

(Specifying cost and freight charges) all of originals must be certified by the Chamber
of Commerce.
22.Manufacturers Invoice: signed original commercial invoices

and copies All of originals must be certified by the Chamber of Commerce.

23.Packing List: Signed packing list in original and copies

24 Insurance policy or certificate in full set blank endorsed issued by an

approved insurance co. covering marine, air and war risks extended to cover

institute cargo clauses (all Risks), WPA/AFPA including theft Pilferage, Non-

delivery S.R.C.C for the CIF value of shipment plus % up to

Insurance covered locally and Policy as above and including shift clause

enclosed

25. Transport Document marked freight

payable at destination prepared by beneficiary

Full set of ocean bill of lading/multi modal track way

bill/receipt

Courier bill original air way bill rail way

Parcel post receipt other____________________________

26.Marked notify____________________________________________________

13 | P a g e
27.Country of the goods origin__________________________________________

28.Package to be marked_______________________________________________

29.Additional conditions______________________________________________-

Advance payment

Advance payment: is a method through which a seller receives payment from a

buyer prior to shipment or the agreed upon goods or rendering the agreed upon
service

There are many cases in which advance payments are required. Consumers with bad
credits may be required to pay companies in advance, and insurance companies
generally require an advance payment in order to extend coverage to the insured
party..

 Import- Payment through bank transfers

 Export- Payment through bank transfers, traveler cheques, cash (as long as it is
declared)

Consignment basis payment

Consignment in international trade is a variation of the open account method of

payment in which payment is sent to the exporter only after the goods have been
sold by the foreign distributor to the end customer.Clearly, exporting on
consignment is very risky, in as much as the exporter is not guaranteed any payment
and its goods are in a foreign country in the hands of an independent distributor or
agent. 
.
Consignment basis payment: It is a method of payment in which the title to the
goods remains with the seller until an agent (distributor) in foreign country sells
them. Payment is made to the seller if and when the agent (distributor) sells the
goods.

Export : it is applicable for perishable items like flower ,meat , fruits , molasses etc as
approved by National Bank Of Ethiopia

14 | P a g e
Guarantee
An independent, documentary undertaking by which a bank for (other legally
qualified entity) (the guarantor), issues, at the request of its customer (the
instructing party), its irrevocable guarantee to pay a sum of money to a third party,
(the beneficiary), provided a complying demand /document(s) is presented.
An international guarantee is an insurance coverage that protects an importer or an
exporter, ensuring a compensation in case of breach of contract

The are different types of guarantees in given by CBE:

✓ Bid Bond
✓ Performance Bond
✓ Advance Payment Guarantee
✓ Loan Guarantee
✓ Retention Guarantee and
✓ Customs Duty Guarantee

Documentary collection
A documentary collection (D/C) is a transaction whereby the exporter entrusts the
collection of payment to the exporter’s bank (remitting bank), which sends
documents to the importer’s bank (collecting bank), along with instructions for
payment.

The role of banks in a documentary collection is limited, they do not verify the
documents, take risks, nor do they guarantee payment; banks just control the flow
of the documents.
With documentary collections, the bank does not cover credit and country risk,
however, they are more convenient and more cost-effective than Letters of Credit
and can be useful if the exporter and importer have a good relationship, and if the
importer is situated in a politically and economically stable market.

15 | P a g e
4 Electronic Payment Services etc

Electronic payments allow customers to pay for goods and services electronically. This
is without the use of checks or cash.Normally e-payment is done via debit cards, credit
cards or direct bank deposits.

CBE provides different types of electronic payment systems

 CBE birr *847#
 Mobile banking *889#
 Internet banking

Internet banking

Internet banking allows a user to conduct financial transactions via the Internet
offers almost every service traditionally available through a local branch including
balance inquiry, transfers, Mini Statement, detailed transactions, and online bill
payments. It provides easy, convenient, flexible and secure payment services for CBE
customers.

Through CBE’s Internet Banking, many transactions can be carried out from the
comfort of your home or office. The online services include:

 Viewing account balances and transactions.

 Making fund transfers between a customer’s own current accounts and
savings accounts.
 Effecting payments to third parties, including bill payments to predefined CBE
customers within Ethiopia.
 Viewing and downloading Current and Saving account statements.
 Requesting for Stop Payments on cheques, etc.
 Applying for a Letter of Credit

CBE birr

16 | P a g e
CBE Birr is a mobile banking services streamed by Commercial Bank of Ethiopia
through banking agents. The bank selects, trains and authorizes agents to provide
banking services on behalf of the bank through a mobile phone. CBE Birr (Wallet
Account) account is a type of pre-paid account in which a user can store his/her
money for any future transaction. Account is protected with a PIN. With the help of
CBE Birr, one can make payments for groceries, online purchases, and flight tickets,
among others.

Mobile banking

1. Is a banking service rendered with the help of mobile telecommunication devices;

2 Can involve communication through USSD, Internet, or an application designed for

the bank services;

2. Enables customers: • To access and manage their savings and current accounts;

• To transfer money from their accounts to their beneficiary or

any person that has a CBE account.

2.2 Services given at branch level

As we have seen above CBE is the largest bank in Ethiopia and the bank is a
representative bank related to import and export this means that the bank provides
the services we have mentioned above as trade services . In addition to this as the
bank auditor told me it is the CBE’s capital that the government uses as the budget
to buy oil,sugar,wheat etc.

In general the above mentioned bank services are provided in all branches. In
addition to the above there are also services provided by the branch such as traffic
fines payment, electricity consumption payments,canal + payments,DSTV payments
it has been stopped now but previously it was possible to pay water consumption
fee through CBE birr. In addition customers can also buy bonds, and shares of
different companies.

17 | P a g e
 2.3 Swot analysis

Strength

 Financial leverage
 Strong management
 Innovative culture
 Asset leverage
 Size advantage
 Economies of scale
 Cost advantages
 Technology
 Customer loyalty

Weakness

 Work inefficiencies
 High staff turnover
 Weak customer handling
 Rural sector development is given less attention
 Low job satisfaction

Opportunities

 Population growth
 New services
 New technology
 Promote islamic banking
 Open branches in rural areas

Threats

 Volatile currencies
 Bad economy
 Political risk
 Intense competition
 Government regulations
 Substitute products
 High rate of inflation

18 | P a g e
 Chapter Three

Practical experiences
3.1 Internship experiences
At first I was too quiet, but after a weeks I started to talk with the employees
communicate with them and asked them information I want and also asked them to
show me their jobs.

My responsibilities at the buba branch was to open accounts and activate mobile
banking but also did income and expense sheet writing. Most of our societies are
illiterate so it becomes difficult to use the digital services like mobile banking, ATM,
CBE birr card less; because of this every customer comes to the bank to get services
which creates crowd on the branch and makes customers unsatisfied with the
services given at the bank.

The actual job I did when I was in the bank was to write the expense and income
sheets and then do the expenses and income on the system. I tried to see the
purchase and delivery in the bank and there are few purchases made at the branch
level most of them are petty cash purchasing materials like pen and napkins are
purchased there. Most of the bank’s purchasing are made at the head office and
some can be made at the district level.

There are various expenses in the branch, for example buying fuel, disposing of
garbage, buying stamp ink, buying a pen, etc. Basically fuel is bought at the head
office but if it runs out the branch buys it to fill the gap until it is sent from the head
office; and since they have a system to report to the head office fuel expense is also
reported by attaching it to the receipt. Each expense is placed according to a

19 | P a g e
category ; for example garbage disposal expense is placed in the miscellaneous
expense, stamp ink, pen etc are placed in the category of office supply expense.

3.2 problems

3.2.1 Problems encountered on the internship

Often the supervisors were unclear about what they expected from me, what
information to give me, tasks I have to accomplish and so on.

The other problem I faced during my internship is that at CBE the work related to
logistics is done only at the head office therefore there are not many things that I
have learned from logistics department angle.

3.2.2 Problems seen at the branch

Most problems I have seen at the branch is a kind of managerial problems as I have
seen most of the employees are not motivated also the managers are not leaders
and also related with purchasing and supply of materials .

Since the number of customers and employees at Buba branch does not much, there
is a congestion every day and a customer has to stay at the bank from 20 minutes to
1 hour to be served.

The other problem I saw in the bank is mainly related to the supply of goods. Most of
the printers are broken and these items cannot be procured at the branch level , so
the manager of the branch must notify to the head office and wait until the item
arrives. Because the ordered items do not arrive quickly the bank’s services are not
efficient. At Buba branch only two printers work permanently and this not only
prevents customers from being dealt with quickly, but also makes the bank not a
preferred bank.

3.3 Strength seen at the branch

20 | P a g e
They have good communication with the district and the head office so they inform
the head office before office supplies like income and expenditure papers run out so
that purchases can be made and they can be supplied quickly. Another thing I see as
a strength is that every item coming from the head office or district is registered and
place on record which is updated regularly and sent to the head office which informs
them about the quantity and status of the fixed assets in the branch.

What I liked the most about the bank is their use of time. There are two types of
opening hours in the bank which are 2:00-6:00 and 3:30-7:00 morning shifts and
then 7:00-10:30 and 8:00-11:30 afternoon shifts, any employee can choose the time
they want and all employees from the cleaning up to the manager will respect time.
All the staff are not even a minute late, in fact most of them come 5 or 3 minutes
early I really appreciate this.An effective time management Scheduling avoids time
wastage and allows us to plan ahead, and gaining more as a result.

3.4 Recommendation
I think it could be better if managers motivate their employees, the employees will
do a better job. And for the congestion at the bank it would be better if the bank
hires more employees and also if educated people are encouraged to use digital
banking and awareness is done, the number of people coming to the bank will
decrease significantly.

In order to avoid the delay of material supply one purchasing specialist can be hired
in each branch and they can be made to buy what can be purchased through
national bidding.

21 | P a g e
3.5 Conclusion
CBE is the leading bank in Ethiopia in terms of capital, number of account holder and
number of branches. In 2014(2021/22) its capital reached 890.1 billion birr, making it
the 3rd largest bank in East Africa. The bank has more than 1800 branches providing
services in most Ethiopian cities. It has 120 branches in Addis Ababa alone.

This internship has been a very useful experience for me. I learned lot of things as an
intern those are

 How to communicate with people in the community who are different from
me.
 Helped me to change my outlook about the work environment.
 Recognized that the work environment is full of practical things whereas our
education is full theories
 Time management and punctuality which allows us to do our assignment
efficiently and meet our schedules.
 Colleague interaction which helps in reaching the goals of organization as an
entity and also is a vital in contributing to a strong organization.

In conclusion,from this internship I have got a lot about the work environment and I
have learned how the theoretical knowledge changed to the practical one and how
to solve problems in the real world. I can safely say that my understanding of the job
environment has increased greatly after this intern.

22 | P a g e
References
 Tadiwos G.

 Nigussu

 www.combank..et

23 | P a g e