Jan 31, 2023

Mawazo Writing Africa

Writing about the main

Somalia licences first two foreign banks since 1970

The Central Bank of Somalia (CBS) has licensed the first two foreign lenders since 1970.

Central Bank Governor Abdirahman Mohamed Abdullahi said that Egypt’s Banque Misr and Turkey’s Ziraat Katli after the 20 The board approved their Applications.

“The CBS board of directors has determined that the two banks have met all of CBS’s banking license requirements and their applications have been approved,” he said.

“After After a In an extensive process, we are pleased that the board has approved the license applications of Ziraat Katlim Bank and Banque Misr.

“Both are solid banks that will add value to the development of Somalia’s financial sector and will contribute to its growth.” of our economy,” he added.

In the 1960s, foreigners operating in Somalia included Italy’s Banco di Napoli and Banco di Roma, Egypt’s Banque de Porte Saide and Britain’s National Grindley’s Bank commercial banks. But when the Supreme Revolutionary Council (SRC) overthrew the civilian government in October 1969, all foreign banks in Somalia were nationalized by order of the SRC on May 7, 1970.

The junta then formed the Somali Merchant and Savings Bank , which used assets of the nationalized lenders in 1972 and operated until its collapse in 1988.

To date, the Central Bank of Somalia has licensed 13 locally owned commercial banks, including Salaam Somali Bank and Dahabshil Bank.

Loans to businesses

Businesspeople have welcomed the move, saying the new banks would improve access to capital for large projects.

“Somalia is resource-rich, and to tap them, innovative people need capital and cash injections that big banks can afford,” said Abdullahi Nur Guled, a Somali businessman from Tanzania, on the phone with The EastAfrican.

He added that people who place their deposits with lenders outside the country can now bank locally.

< p>“No society can develop, create jobs and fight poverty without banks that can invest in businesses, government services and projects. “