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Hundreds of Afghans have been trying to withdraw
money from the country's largest bank, amid concerns that it could collapse.
The panic was sparked by reports that Kabul Bank has lent millions of dollars
to members of the political elite, who used the money to make risky
investments. A slew of reports has come up with allegations that relatives of Afghanistan's leader Karzai and executives of the
bank have sunk 100s of millions of Federal Reserve Notes (FRN) into Dubai and
other property investments before prices took a sharp dive.
According to a BBC report,
Armed police in pick-up trucks have been stationed outside the main
branch of Kabul Bank as customers continue to withdraw money amid fears the
Afghan bank may collapse.
Barbed wire has also been placed across the road to hold back the
crowds.
The run on the bank began earlier (last) week after allegations of
corruption and mismanagement, although officials have maintained the bank
will not fail...
Customers have been told that the branch is the only one that holds US
dollars but they can only withdraw a maximum of $10,000.
"I am withdrawing my money because I am taking a trip and I also
believe my money will not be safe in this bank," said 26-year-old Waheed
Shirzoi...
Kabul Bank, Afghanistan's largest commercial bank, is reported to have
run up huge debts that it cannot afford to pay.
Last week, newspaper reports said the bank's two top executives -
chairman Sherkhan Farnood and chief executive Khalilullah Ferozi, who each
own 28% of the bank's shares - had been replaced and Mr Farnood ordered to
surrender $160m worth of property purchased in Dubai.
I note
that the only difference in today's bank runs is that they are recorded in HD
full color vs. the last ones in the 1930s: 50 Seconds Bank Run Video From Germany 1931
Toni Straka
Editor, the Prudent Investor
Toni Straka is an INDEPENDENT Certified Financial Analyst (OeVFA, EFFAS) who worked as a
financial journalist for 15+ years and now evaluates global market trends.
Analyzing financial and political news permanently he wants to share his
insight with those who understand that we are in an era of global
redistribution of wealth. The US-European centric approach does not work
anymore. Five billion people in the developing countries now demand their
fair share of the world's resources.
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