Abstract:
The study aimed to investigate various aspects of foreign bank entry into Ethiopia's banking
sector, including assessments, attracting factors, benefits, risks, and impacts. It employed a
descriptive research design and a mixed-research approach, targeting key personnel from 31
banks in Ethiopia, including the Development Bank of Ethiopia. Data were collected through
questionnaires and interviews, with a sample size determined using purposive and simple
random sampling techniques. Statistical analysis was conducted using SPSS version 26.The
findings highlighted Ethiopia's growing economy, untapped market, government initiatives,
and natural resources as highly attractive factors for foreign bank entry. However, risks such
as dominance, lack of local commitment, cream-skimming behavior, and challenges related
to regulatory oversight and capital mobilization were identified. Despite these risks, there
was a positive perception of benefits, including technological advancement, market
development, competition enhancement, and attracting foreign investments. To capitalize on
the perceived attractiveness of Ethiopia's economy, and the study recommends promoting
these factors to potential investors. Additionally, policymakers are urged to address concerns
regarding the potential dominance of foreign banks by implementing regulatory measures
that promote competition and ensure a level playing field for domestic banks
