BNP Paribas and Citibank suspended banking operations in Cote d’Ivoire on Monday as a power struggle following a disputed presidential election tightened its grip on the country's economy.
BNP Paribas, the second largest banking operation in the country, was closed due to security concerns. The entire BICICI network was closed until further notice because of death threats against banking staff.
Citibank also said it would be closed giving no official reason but saying it would continue to monitor the situation.
Cote d’Ivoire has been in turmoil since a disputed November presidential election between incumbent Laurent Gbagbo and rival Alassane Ouattara. Gbagbo’s planning minister condemned the bank closures and accused the banks of breaking the law.
The power struggle has hit the banking sector as Ouattara, backed by western nations and regional bodies, attempted to cut Gbagbo’s access to funds and force him from power. West Africa’s monetary union cut off Gbagbo's access to state accounts at West Africa’s BCEAO central bank last month.
“It was becoming very difficult for those banks to operate in Ivory Coast because they can’t use the BCEAO platform any more,” said Standard Bank analyst, Samir Gadio.
Gadio said that procedures that usually took an hour were now taking up to eight days, and added that there was a reputational risk that if the banks continued to operate in Ivory Coast they might be seen as allowing Gbagbo’s regime to survive.
Some Western nations have imposed travel bans and sanctions on a range of individuals and organizations backing Gbagbo.
After being cut off from the regional bank, Gbagbo sent soldiers to seize its Abidjan unit and appropriate local reserves, forcing the bank to close its Cote d’Ivoire operations completely and causing issues with liquidity and check clearing.
Banking sources say the military has since intimidated banks into participating in a new clearing system set up in the building Gbagbo seized. Some have received death threats.
The BICICI posted the following message to its customers on their website:
URGENT MESSAGE TO OUR CUSTOMERS - Dear Customers, We regret to inform you that the BICICI temporarily suspended its activities from this day 14 February. For many weeks, despite the unstable situation facing Côte d'Ivoire, BICICI did his utmost to serve you. These days, however, have seen an increase in legal and regulatory confusion related to the particular situation of the country. Today we are no longer able to ensure our activities in satisfactory conditions of legal and accounting for our customers, or physical security for our employees. That's why we had to close down temporarily the bank. We are sorry and hopefully a return to normal as soon as possible in order to once again put our bank at your service.
Currently rated 3.8 by 8 people
- Currently 3.75/5 Stars.
- 1
- 2
- 3
- 4
- 5