South Sudan Commercial Banks as We Know Them
By Malith Alier, Perth, Australia
Saturday, 20 April, 2019 (PW) – News is coming that the five-year old war is taking a toll on the pillars of the economy among which are commercial banks. Some banks are in deep trouble more than others as we speak. They have run out of cash and are technically insolvent – can’t pay creditors or depositors.
The history of the mushrooming commercial banks started in 2011 towards independence. This authored attended an initial meeting organised by Bank of South Sudan Governor, late Elijah Malok Aleng. In that meeting, he encouraged the owners of the so many foreign exchange bureaus to come together and establish commercial banks as one way of pooling resources to raise capital.
That advice was taken in a wrong way and wealthy individuals rushed to established banks as single or family shareholders contrary to the law and expectations in the country. The only banks operating in the country before the rush included; Kenya Commercial Bank, Equity, Ivory, Nile and Buffalo.
The rapid increase in the commercial banks after the announcement was phenomenal. We have all sorts of banks with murky ownership soon after. Many at times thought that they’re extension of foreign exchange bureaus justifiably.
The commercial banks or banks in South Sudan can be classified into three categories; those which emanated from northern Sudan, those from Africa & the rest of the world, and those emerging in the new nation.
From Africa and the rest of the world:
1. Kenya Commercial Bank
2. Equity Bank
3. Eco Bank
4. CFC Stanbic Bank
5. Commercial of Ethiopia
6. Qatar National Bank
From north Sudan:
- Ivory Bank
- Bank of Khartoum later changed to Charter 1 Bank
- Agricultural Bank
South Sudan:
1. Eden Commercial Bank
2. Afriland First Bank
3. National Commercial Bank
4. Buffalo Commercial Bank
5. Cooperative Bank of South Sudan
6. International Commercial Bank
7. Liberty Commercial Bank
8. Mountain Trade and Development Bank
9. National Credit Bank
10. Nile Commercial Bank
11. Opportunity Bank
13. Phoenix Commercial Bank
14. South Sudan Commercial Bank
15. Sudan Microfinance Institution
16. Orbit Bank
Nile Commercial Bank (NCB) was the first bank to be established by the SPLM during the interim period 2005-2011. Therefore, it was wholly owned by the government of Southern Sudan which made it susceptible to negative political influences that came to dog it until today. Its capital base sooner came under assault by the generals and the government had to bail it out on numerous occasions.
By 2007 the banks’ customers were desperate for their dear money caught up in that fledgling bank. “Why should I be crying for my money which I thought was kept safe in this bank.” Said one of the despairing customers at the time.
Ivory bank is the oldest commercial bank in South Sudan founded in 1994 by business people of the South Sudanese origin according to Wikipedia. It was headquartered in Khartoum until 2009 when it relocated its Head Office to Juba in preparation for the impending separation.
The two Kenyan banking giants, KCB and Equity dominated business in the nascent country until now. Their dominance however, was drastically affected when the war destroyed their lucrative branches in Bor, Malakal and Bentiu in 2013. They never recovered from that debacle. By 2016 or earlier, the two banks announced farther closer of more branches country wide as a result of bank runs – customers withdrew their savings as pound was devalued and inflation set in.
Commercial banks in South Sudan are classified into foreign owned, indigenous and those that originated from Sudan. Originally, the commercial banks were supposed to be amalgamation of the mushrooming foreign exchange bureaus according to the intention of the commercial banks’ regulator, the Bank of South Sudan. However, wealthy individuals or families by-passed this direction and founded the banks as individual or family owned.
The civil war in 2013 greatly affected the commercial banks in the country. Many branches were destroyed in Bor, Malakal and Bentiu. Farther branches were closed in later years as a result of inflation and deposit withdrawals by customers.
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