Home | News    Saturday 8 July 2006

Byblos Bank Africa’s business booms in Sudan

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July 7, 2006 (KHARTOUM) — Sudan offers good opportunities for international banks seeking to cash in on an oil and construction boom, despite conflict in the African country’s provinces and U.S. sanctions, the manager of Byblos Bank Africa said on Friday.

"The banking sector is improving tremendously. However, since the country has opened up the pressure on liquidity and financing needs are growing," said Nadim Ghantous, general manager of BBA, which is 65 percent owned by Lebanon’s Byblos Bank , one of the country’s largest.

"The local banks, the whole banking sector, is not able to cope with this big load," he told Reuters.

Byblos Bank Africa opened in Sudan in 2003, the year conflict flared in the country’s Darfur region when non-Arab tribes took up arms against Khartoum. Tens of thousands have been killed and 2.3 million people driven into squalid camps. In May, one of three Darfur rebel groups and the Sudanese government signed a deal, but peace remains shaky.

The conflict prompted many companies to pull out of the country, and in January Switzerland’s Credit Suisse said it would no longer do business there.

But Ghantous said BBA was unperturbed by the violence.

"We come from an environment when during the war in Beirut, when the battle was occurring one street down the road, we were doing business," Ghantous said, referring to Lebanon’s 15-year civil war, which ended in 1990.

In May, Kenya Commercial Bank (KCB) became the first international bank to open a branch in southern Sudan since the end of a decades-long civil war there, Africa’s longest. The conflict in southern Sudan is separate from violence in the Darfur region.

"Aversion to risk is a very personal matter... From far away risk is high, but when you come here and see with your own eyes and get a feel for the place, of course you feel much better. And then you can decide to go ahead or not," Ghantous said.

U.S. sanctions have had little effect on BBA, apart from complicating wire transfers, because parent bank Byblos has no operations in the United States, Ghantous said.

The United States says Sudan is a state sponsor of terrorism and Sudanese banks are banned from holding accounts with U.S. banks.

"Some sanctions are an advantage, some not. One advantage is that we’re here but many others are not. Otherwise we’d have HSBC . We’d have Citibank," Ghantous said.

Ghantous said BBA made $2 million in operating profits in 2004, its first year of operations, $7 million in 2005 and had forecast about $10 million for 2006.

(Reuters)

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