Capital requirements for banks in Syria will at least double to strengthen a nascent financial sector attracting Gulf investment despite the global crisis, the central bank governor said yesterday.
“The new regulations will come into force as soon as possible. We are encouraging new banks to enter the market because Syria can absorb many more,” Adib Mayaleh said in an interview.
Syria has been controlled by the Baath Party since it took power in a 1963 coup and nationalised large parts of the economy.
The government relinquished its monopoly on the banking sector only six years ago and the country of 20 million people now has 13 privately-owned banks and six state-owned ones.
Mayaleh said the minimum capital requirement to set up a conventional commercial bank will rise from the present $30m to $80-100m, which would bring them near the requirement for Islamic commercial banks.
“We are already seeing the banks investing as much capital voluntarily,” he said, adding that profitability at privately held banks was “very high” at near 10 percent. “The international crisis has not affected us,” he said.
Mayaleh pointed to a public offering underway to raise 34 percent of $107m in planned capital for a subsidiary of Qatar National Bank.
Albaraka, a banking group based in Bahrain and controlled by Saudi billionaire Sheikh Saleh Kamel, plans to raise a similar amount in an October offering for a new Syrian branch, Mayaleh said.