Asmara, 6 November 2009 – News

The general manager of the  Commercial Bank of Eritrea (CBE), Mr. Yemane Tesfai, said that unlike other international banks which are engulfed in deep bankruptcy and crisis as a result of the current global economic meltdown, the Bank is not only free from debt but is also registering growth.

He explained that the root cause of the bankruptcy of the major world  banks emanates from the fact that they resorted to investing in what they claim ‘very profitable’ investment which in actual fact leads to high risks, besides granting loans without securing enough reserves. In this respect, Mr. Yemane pointed out that such a phenomenon did not affect the Eritrean Banks, as they did not engage in activities of this nature and invest assets abroad.

Stating that the Commercial Bank of Eritrea has secured its due reserve and deposit in accordance with the rules and regulation of banking activities, he indicated that its capital has increased to over 1 billion Nakfa, which in turn raised the initial capital of 50 million Nakfa 2,200 fold.

The general manager further noted that the CBE is extending loans to private investors or others engaged in development tasks in the country, and that loan amounting to more than 230 million Nakfa has been granted this year to 515 customers. Mr. Yemane went on to say that over 456,000 Nakfa has already been deposited in customers savings and checking Bank Accounts in the CBE, and that an interest rate close to  430  Nakfa is being paid annually to those who have deposited in saving accounts.

Furthermore, he elaborated that contrary to some other Banks on the verge of quitting paying interests to the deposited saving accounts or only paying below 1%, the Eritrean banks are paying 3% interest rate in foreign currency and 4% in local currency.

Pointing out that strenuous efforts are being made to expand equitable banking service across the nation through opening branch offices in all administrative regions, Mr. Yemane indicated that the CBE maintains working relations with 20 reputed foreign banks in facilitating hard currency deposit, exchanging remittance, as well as import and export transactions.  He also called on customers to resort to the habit of using cheque and other banking procedures instead of tender money.