Somalia issues licences to first international banks in the country

SOMALIA – Central Bank of Somalia has announced that it had awarded licences to two foreign banks as the troubled Horn of Africa nation opens up the industry to international lenders.

State-owned Banque Misr of Egypt and Turkey’s Ziraat Katilim will become the first international banks to operate in the country.

“The application of both banks underwent months of an extensive process,” the Central Bank said in a statement., adding that they had the green light to establish and operate branches.

The approval for Ziraat Katılım and Egypt’s Banque Misr came after directors of the central bank held an ordinary meeting on July 2 to discuss license applications.

“We are happy that the board has approved the licensing application of Ziraat Katilim bank and Banque Misr,” said Abdirahman Mohamed Abdullahi, the governor of Somalia’s central bank.

He said Ziraat Katılım is a solid bank that will add value to the development of Somalia’s financial sector and contribute to the growth of the country’s economy.

Somalia said the two banks that will operate in the country is testament to the success of the reform of the country’s financial sector further enhancing opportunities of investment.

One of many poorest international locations on the earth, with greater than 70 per cent of its inhabitants dwelling on lower than US$1.90 a day, Somalia is struggling to get well from a long time of civil warfare.

The nation of 15 million individuals has a minimum of half a dozen business banks, with some providing companies through the hawala system, an off-the-cuff community of cash transfers carried out by way of face-to-face ensures.

Hawalas are low-cost and environment friendly to make use of, permitting cash to be deposited in a international financial institution and immediately credited to recipients who’ve to offer solely fundamental identification particulars matching these supplied by the sender.

The announcement on Sunday comes barely six weeks after President Hassan Sheikh Mohamud took workplace following a long-overdue election and a political disaster that lasted properly over a 12 months.

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