CBE Takes Control Over AIB

Central Bank of Egypt (CBE) announced that Arab International Bank’s (AIB) Extraordinary General Assembly approved amending some articles of its statute so as to be under the supervision and monitoring of CBE, Egypt’s banking and monetary regulator.

CBE said in a statement today that AIB’s Extraordinary General Assembly also approved that its other branches, when established, shall be under the supervision and monitoring of the countries’ regulations in accordance with the conditions that regulate banking and credit transactions. Besides, It is also approved that AIB will conduct transactions in Egyptian currency and foreign currency. This amendment enables AIB to fulfill its expansion plans.

Talks were taking place between CBE and shareholders in AIB for years over this issue until being approved on March 22nd 2012.

Being not subject to the supervision of CBE or Central Auditing Organizations and not abiding by transparency rules, Bankers warned earlier that AIB may become a refuge for businessmen whose money was frozen under Egypt’s public prosecutor’s decree.

Accordingly, bankers demanded intervening to amend AIB’s foundation agreement which was signed between Egypt, Libya and Oman in April 1974 to be under the supervision of CBE.

AIB enjoys many exclusive advantages such as conducting transactions in freely convertible currencies as well as having full legal personality with capacity to contract with member states, non-member states, shareholders, or any other international institutions which are enjoying tax exemptions and confidentiality. In addition, AIB was not subject to nationalization, confiscation or judicial or administrative seizure.

Besides, AIB is not subject to international arbitration and its cash, profit, dividends and transactions are exempt from taxes and charges. Judicial or administrative seizure procedures cannot be taken against the Bank unless after a final verdict.

Amwal Al Ghad reported on 9/2/2011 that Mamdouh Ismail, a member of the Lawyers Syndicate, has submitted a communiqué (no.101 of 2011) to the public prosecutor in February 2011 against Atef Ebeid chairman of AIB because of transferring money without names but instead with codes, indicating that it is illicit money.

Ismail called on the public prosecutor to freeze AIB’s transactions and transfers, detain the chairman of the Bank and investigate about this matter. After that, Ebeid was dismissed from the Bank.