New measure by Bank of Sudan puts banks at risk of bankruptcy

Altagyeer: Khartoum

Bank of Sudan issued a new regulation ordering banks to scale down cash withdrawals by clients from 2000 pounds to only 1000 pounds starting Monday August 13, 2018.

Bank sources told “Altaghyeer” that they received the newly-issued measure from the Central Bank demanding to strictly abide by it. The sources went on to add “we received verbal instructions from the Central Bank to demanding cash withdrawals be capped at 1000 SDG instead of the 2000 SDG limit stated previously”.

Bank of Sudan opted for this action months ago in an attempt to tackle brokers by reducing amounts of cash in their possession which would enhance the Sudanese pound’s stand versus other currencies.

The anonymous bank sources also revealed that this measure will lead to the emergence of new problems within the banking sector that might result in bankruptcy.

Sources pointed out that “now many banks have been adversely affected when previously asked to limit cash withdrawals, with this new request I expect investors and clients to be reluctant in their dealings with us and this could lead to some banks being out of business and become totally bankrupt”.

The banking sector is currently facing obstacles in transferring money to and from Sudan despite American sanctions being partially lift last October.

Altaghyeer previously reported on the growing trend among merchants buying safes after issuing the first measure limiting cash withdrawals by clients to 2000 SDG, indicating the reluctance in dealing with banks.

Sudanese economy suffers structural impediments and its crises exacerbated after secession of the oil-rich South in 2011 and the loss of three quarters of oil revenue.

Economic experts hold the government responsible for the “economic collapse” because of its heavy reliance on oil imports’ revenues and adopting financial and economic policies resulting in severe repercussions on production sectors (agriculture sector with its crop and animal divisions and industrial sector), and cutbacks in spending on education and health which led to a continued decline in human development indices. Moreover, Transparency International ranks Sudan among the most corrupt states in the world according to its annual corruption perceptions index report.

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