CBY: BANKING SECTOR HAS PASSED FINANCIAL CRISIS' EFFECTS

SANA'A,Feb.23 (Saba) – The Cabinet reviewed here on Tuesday a report submitted by Governor of the Central Bank of Yemen (CBY) on the banking and monetary development during 2009 comparing with 2008.

The report affirmed that the Yemeni banking sector has passed the global financial crisis and its negative effects, pointing that the volume of the unified balance sheet of the Yemeni banks increased from YR1.5 trillion in 2008 to YR1.6 by the end of 2009, with a growth rate of 8 percent.

The volume of deposits in the banking sector increased by YR 110 billion in 2009 to reach YR1.34 trillion, with a growth rate of 9 percent from 2008, the report pointed indicting that the foreign trade has absorbed 60 per cent from the finance and loans presented by the banking sector and 18 percent has gone to the industry.

Most banks have fulfilled the requirements of the capital increase as the paid up capital and reserves in the banking sector reached to YR 143 billion at the end of 2009, compared with YR119 billion in 2008, the report revealed.

The CBY report pointed out that the Yemeni banks have covered about 85 percent of the total irregular debts of allocations.

The cabinet got acquainted with the bank's efforts to achieve the monetary stability, as the bank has provided most of the needs of foreign currency in the Yemeni market and paid up the state foreign obligations and the requirements of the economic and social development, despite the drop in the oil resources and foreign currency inflows, taking into account to keep an appropriate level of foreign reserves, which amounted to $7 billion by end of 2009.

From the report, the cabinet noted the great development in the payment systems and the spread of bank branches in various provinces and the growing increase in the funding activities conducted by banks to small and medium enterprises as well as the CBY's role in implementation of the state budget.

BA