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Media and Press Releases
Afghanistan Financial Sector Development Forum
“making finacnce work for afghanistan
Tuesday March 31, 2009
Central Bank urges action to support a stronger
financial system at the Afghanistan Financial Sector
Development Forum.
DAB Press Release No. 4/2009
Kabul, Afghanistan; March 31, 2009 - Over 150
stakeholders representing the Afghanistan government,
parliament, civil society, academia, media, bilateral
development partners, regional and international
organizations convened at the first Afghanistan
Financial Sector Development Forum in Kabul on 31 March,
2009.
The Afghanistan Financial Sector Development Forum (FINSEDEF)
is a multi-stakeholder platform for debating, discussing
and initiating concrete strategies for making finance
work for all Afghans.
The Central Bank of Afghanistan, which championed the
forum, stressed that strengthening the Afghanistan
financial system would support economic growth, job
creation
and poverty reduction.
In the key note speech, Central Bank Governor A.Q Fitrat
said, "financial markets can only develop and possess
the desirable qualities of “breadth, depth and
liquidity: if there is wide broad-based participation by
individuals, households and businesses.â€
He added that "as of January this year, total
deposits of the banking sector exceeded USD 2.41
billion and commercial banks’ ’total lending to more
than 79,000 businesses and SMEs reached USD 1 billion
creating thousands of new jobs in the economy.â€
Over the past seven years, the financial sector has been
strengthened by a wave of reforms through which the
Central Bank has been modernized, foreign banks have
entered the market and privately owned commercial banks
have become major players on the financial scene.
However, much more needs to be done to make finance work
better for Afghanistan. The Central Bank used the forum
to unveil several major initiatives to address these
challenges. The first initiative is the Central Banks
Five Year Strategic Plan which is the roadmap or
organizing framework for addressing the challenges
confronting the financial sector. The second initiative
is a proposal to transform the Afghanistan Institute of
Banking and Finance into a modern residential training
center with distance learning capabilities. The third
initiative is a proposal to establish the Afghan Deposit
Insurance Corporation to protect small depositors in the
unlikely event of a bank failure.
The fourth initiative is the establishment of a credit
information bureau which
is control to credit risk management and the promotion
of a sound credit culture in the financial system. A
credit bureau reduces asymmetric information in credit
markets thus allowing for greater levels of lending,
speeds up the loans process and promotes prudence and
professionalism in financial institutions.
The fifth initiative is the introduction of a collateral
registry. Banks will often require property or real
estate as collateral before granting a loan. The
existence of a collateral registry which documents the
ownership of real estate has been shown to improve
access to finance which is a major constraint to private
sector development.
Further information can be found on the DAB website at:
www.centralbank.gov.af
Issued by DAB Information and Communication Department
Ibni-Sina-Watt
Kabul
Afghanistan
Tel: +93-20-210-4146
E-mail: aimal.hashoor@centralbank.gov.af
Web: www.centralbank.gov.af
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The supreme counsel of DAB held
on 12th and 13th Hamal 1388
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Afghanistan Financial Sector
Development Forum "Making Finance work for
Afghanistan" was held on Tuesday March 31, 2009 in
Kabul.
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