CBY WARNS BANKS THAT RETAIN BIG RESERVES OF FOREIGN EXCHANGE

SANA'A, April 15 (Saba) – The Central Bank of Yemen (CBY) warned on Thursday the banks that retain big reserves of foreign exchange exceeding the allowable limit of 25 per cent of the capital and reserves of any bank.

Retaining big reserves of foreign exchange by banks leads to great pressure on the exchange market, the CBY pointed out.

This came during the meeting held in the CBY, chaired by the bank's Governor Ahmad al-Samawi and attended by the general mangers of banks operating in Yemen.

The central bank affirmed that it would take firm actions against the violating banks through depriving them of exporting foreign currency to the outside and they would be excluded by the central bank when providing the exchange market with foreign currency.

In the meeting, a number of issues were discussed relating to the developments at the Yemen banking arena, in forefront of which the developments in the foreign exchange rates.

At the meeting, al-Samawi confirmed the safety of economic, monetary and banking conditions, affirming the central bank's commitment to cover the bill for imports of basic materials within the controls circulated by the central bank in 1999.

The central bank has reserves of foreign exchange being enough to cover imports of 10 months, al-Samawi pointed out.

He indicated that the Yemen resources of foreign exchange continue to increase as a result of new oil discoveries, and the resources of exporting liquefied natural gas and rising world prices for oil and gas.

BA