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Afghan lawmakers OK funds for Kabul Bank bailout

Parliament agrees to provide up to $825 million to recapitalise central bank after graft investigations

AP, Saturday 15 Oct 2011
Views: 997
Views: 997

Afghan lawmakers have agreed to reimburse the government for bailing out the Kabul Bank, which nearly collapsed last year.

The lower house on Saturday passed a bill to provide up to US$825 million over the next eight years to recapitalise Afghanistan's central bank.

The bank's troubles began after reports that top bank executives issued more than $800 million worth of questionable loans to shareholders, Afghan officials and friends.

Finance Minister Omar Zakhilwal says he hopes Saturday's decision will lead the International Monetary Fund to extend Afghanistan a new line of credit.
Afghanistan has been without IMF backing for more than a year, threatening to choke off billions in aid to the country.

Zakhilwal says $70 million worth of questionable loans has been recovered.

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