An Ethiopian bank president has been released from jail where he was being held on suspicion of corruption in a multi-million US dollar letter of credit (L/C) deal.

Despite his release however, the board of Wegagen Bank decided that Kidane Nikodimos, the bank's second president since its establishment in 1997, should not yet return to his desk.

Allegations

Kidane was detained for 46 days in relation to an allegation made by Ethiopia's Ethics and Anticorruption Commission that he had allowed an undertaking for a L/C worth US$6.6 million.

The Development Bank of Ethiopia (DBE), where Kidane was once vice president, guaranteed the L/C.

Addis Industrial

The bank president had apparently allowed Wegagen Bank to open the L/C in favour of Addis Industrial Ltd.

Businessman Mulugeta Guade, who the Addis Fortune says was behind the alleged scam, owned Addis Industrial Ltd.

Suspension

Guade was a founding member of Wegagen Bank before he was forced to sell his shares as a result of legal actions and debts associated with some of his other business interests.

The federal high court released Kidane after prosecutors declined to press charges against him, but according to the Addis Fortune, reliable sources say Wegagen's board subsequently suspended him from office until further notice.

This article represents the views of the author and not necessarily those of the ICC or any of the other partners in DC-PRO.