Home | News    Friday 24 April 2009

South Sudan Nile Commercial Bank out of cash: official

By Isaac Vuni

April 23, 2009 (JUBA) — Southern Sudan based Nile Commercial Bank (NCB) has run out of cash to meet its obligations, the clearest sign to date of the deepening financial crisis facing the semi-autonomous region.

The cash strapped bank has been unable to honor withdrawal requests from its clients who have deposited their own salaries. The bank has advised impacted customers to wait indefinitely.

Bank officials have pointed fingers at some officials at the Government of Southern Sudan (GoSS) saying they are to blame.

The Assembly branch manger in Juba, Marta Michya alleged that some senior GoSS officials borrowed “huge amount of money but failed to repay”.

“Hence we told our clients to wait until the borrowed money is paid back” she said.

The NCB official added that some of the money has been loaned out to some of these officials without proper collateral.

South Sudan has suffered along with the North of the sharp decline in oil exports which accounts for 93% of its 2009 budget.

GoSS has implemented strict fiscal measures to control spending as part of the efforts to weather the economic crisis.

Government officials, World Bank and Joint Donor Team representatives described the financial situation in Southern Sudan as “serious.”

Last month the Governor of the Bank of Southern Sudan (BoSS), Elijah Malok warned that NCB already in financial crisis and on the verge of total collapse.

He also cautioned that the few other private banks in Southern Sudan may soon follow suit.

The Assembly branch manager said that opening bank accounts with them is a stipulation for employees to get their monthly paychecks cashed.

A bank’s client who declined to be identified told Sudan Tribune that today “even if one wants to withdraw 100 Sudanese pounds, the bank tellers kept on delaying it for more than one month now.

The client was denied a withdrawal of 800 Sudanese pounds.

The NCB website says that the bank was established in 2003 and has 20 branches in Southern Sudan and offices in Northern Sudan, Kenya and Uganda.

The non existence of basic infrastructure in South Sudan and the lack of banking knowledge among the population constitute great challenge to the banking sector.

There were recent reports that the commissioner of Western Equatoria fled to Kenya with $1 million to Kenya during Easter holidays; speaker of Eastern Equatoria was accused of stealing 36 millions dollars.

It was also alleged that $240 million were found in Benjij Hotel Juba when the hotel caught fire and that millions of dollars were caught being smuggled out of south in a coffin.

However there were no independent confirmations of these reports.

(ST)