Most of Yemen's commercial banks have ceased all activities and many employees have been laid off, due to the deteriorating situation in the country. Several bank owners complained of large cash withdrawals which may prevent banks from continuing to conduct their daily business activities.
Dr. Munir Aeriqi, former President of a Yemeni government bank, said that “all commercial banks have been negatively affected by the deteriorating economic, political and security situation experienced by the country since the beginning of February.”
Aeriqi confirms that banks suffering from large withdrawals may collapse and notes that liquidity is scarce. Dozens of banks are carrying out measures to ease monetary withdrawals such as reducing official working hours and initiating electricity interruptions.
Economic experts note the current crisis in Yemen has greatly impacted the Yemeni economy, especially the banking organizations which provide loans and credit to organizations and individual borrowers in order to meet their financial needs.
Yasser Almiasa, editor of the Yemeni Banking Guide, said the Yemeni banking system is modest and doesn’t have any investments in international banks, investment funds or real estate sectors and, thus, is only affected by local economic fluctuations and tourist conditions.
Almiasa notes that most, if not all, banks have been affected by large withdrawals by customers as a result of their worry causing banks to set a ceiling for withdrawals. The banks state that if the crisis continues for much longer, Yemenis will witness a string of bank closures. Some banks have already begun restructuring and discharging employees under the pretext of the current economic crisis and their inability to pay salaries.
Source: www.yallafinance.com
