Factors Affecting Anti-Money Laundring Implementation:The Case of Selected Commercial Banks In Ethiopia

Abstract

The main objective of the study was to investigate the factors affecting the level of anti-money laundering implementation in selected Ethiopian commercial banks, using both primary and secondary data. The primary data for the research was collected directly from the respondents using a questionnaire, while secondary data was obtained from the relevant report of the Financial Intelligence Center (FIC) and National Bank of Ethiopia (NBE). The study used purposive sampling technique, and the sample size for this study was 170. The study used both descriptive and econometric analysis methods. Descriptive analysis included frequency tables, mean, standard deviation, and relative important index. Econometric analysis employed an ordered logistic regression model. The results indicated that the independent variables, which are experience, resource, leadership commitment, risk profile, and cost of technology adoption, had a significant effect on the level of anti-money laundering implementation. Based on the findings of the study, experience, resource, leadership commitment, risk profile, and cost of technology adoption have a significant effect on the level of anti-money laundering implementation in selected Ethiopian commercial banks. Banks should prioritize hiring and retaining experienced employees in order to improve their anti-money laundering implementation levels.