Afghan Bank's Corruption Could Lead to $900 Million in Losses

Kabul Bank in Kabul, Afghanistan is the nation's largest bank and right now one of it's poorest. The entire country of Afghanistan is on edge waiting to find out the total losses on the bank which are believed to be in the area of $900 million. If these numbers turn out to be accurate would most likely cause the bank to shut down and bring the entire Afghan economy along with it. The government right now is pumping money into the bank to keep it open which is causing even further strain on the already less than well off nation. The main concern even if Kabul Bank doesn't shut down is the threat of people taking their money elsewhere. A run on solvent banks and a lack of confidence in donors could cripple the economy.

The cause for these financial losses are unclear as of now but it is believed the money went into the pockets of a select few Afghans with political ties. The current knowledge of where the money exactly went is none. They have no idea where the money is which is going to show how poorly run the bank is. It was shown in WikiLeaks that the fraud scheme was known by the government but they were more focused on stopping the funding of terrorists than focusing on how the banks were being run. It is clear that the section of the bank that most of the money left from is the loan department with over $800 Million currently out in loans, many of which they don't expect to get back.

Spencer Darrow

http://www.nytimes.com/2011/01/31/world/asia/31kabul.html?pagewanted=2&_r=1&ref=world