DAB Rejects Taking over Kabul Bank

Following a huge wave of reports claiming Afghanistan Central Bank's (DAB) control over the Kabul Bank, head of the DAB rejected taking over the Kabul on Wednesday

"The control of Kabul Bank is not in our hands. Kabul Bank itself has appointed a new chief and all other Kabul Bank staff are hold their positions as before,"said head of Afghanistan Central Bank, Qadir Fitrat. "Only two persons have resigned in Kabul Bank, based on a decision made by the High Council of Afghanistan Central Bank."

Kabul Bank handles salary payments for Afghan soldiers, police and teachers, and has taken in more than $1 billion in deposits from ordinary Afghans.

The decision on management shift of the Kabul Bank was made by the President Karzai after evidence was presented to him about the bank's illicit dealings by the Central Bank governor, Abdul Qadir Fitrat.

Sherkhan Farnood and chief executive Khalilullah Fruzi, Kabul Bank's top management, were summoned by the Central Bank on Monday and were asked for their resignation.

A former gem trader, Masood Ghazi, is to replace Fruzi, and to take charge of Kabul Bank's deals, said people with the knowledge of the discussions.

The Shareholders of the Kabul Bank included Mahmoud Karzai, the president's brother, and Haseen Fahim, the brother of Vice President Mohammad Qasim Fahim, who is hospitalised for heart surgery in Germany, according to sources close to the situation.

The Washington Post quotes Mahmoud Karzai as saying, "this is a very good thing. We can now work according to regulations of the Central Bank."

"If the Central Bank says I want these [Kabul Bank loans] to be returned, then I will comply with that," the Washington Post quotes Fahim, the vice president.

Head of DAB remarked in a press conference that Sherkhan Farnood and Khalilullah Fruzi resigned voluntarily because of a reform in Kabul Bank.

And based on the decision made by the high council of Afghanistan Central Bank, bank shareholders are not allowed to lead banks, said DAB.
Mr Fitrat rejected that SherKhan Farnood and Khalilullah Fruzi were on a travel ban.

"Wether it is Mr Farnood or Mr Haseen; if they have taken loans, they will repay it," said Mr Fitrat.

Kabul Bank shareholders commented that the new head of the Bank has been appointed according to their own suggestion.
"I myself accepted him as the chief," said a shareholder of the Kabul Bank, Sherkhan Farnood.