Afghanistan's central bank drained most of its cash reserves before the country fell to the Taliban

·2 min read
Afghans sit on a wall outside New Kabul Bank waiting to withdraw cash
Afghans waiting to withdraw cash on August 15. Rahmat Gul/AP Photo
  • Afghanistan's central bank drained most of its cash reserves before the country fell to the Taliban.

  • The central bank moved money from Kabul to provincial branches and auctioned off US dollars.

  • The Taliban has been unable to get its hands on the central bank's almost $10 billion in reserves

  • See more stories on Insider's business page.

Afghanistan's central bank drained most of its US dollar cash reserves before the country fell to the Taliban last month, Reuters reported on Wednesday.

In a confidential review for the Afghanistan's international donors, reviewed by the news agency, economic officials from organizations like the International Monetary Fund and World Bank said the country's financial woes began weeks before the Taliban takeover.

By the time that Kabul fell to the militant group, the central bank owed hundreds of millions to the commercial banks, the report said, and auctioned off US dollars.

The bank also moved money from Kabul to provincial branches, and some of that money ended up getting stolen, the report said.

Meanwhile, Afghanistan's banking system is close to collapsing, the head of one of the country's biggest lenders said.

Syed Moosa Kaleem Al-Falahi, the chief executive of the Islamic Bank of Afghanistan, told the BBC that Afghanistan's financial industry was dealing with an "existential crisis."

He said customers were panicking after the Taliban takeover and Western nations and agencies froze the country's funds in response.

The Taliban has been unable to get its hands on the Afghan central bank's almost $10 billion in reserves, Insider previously reported.

Most of the central bank's $9.5 billion in assets, some of which are held in New York, were frozen by the US in August after the Afghan government collapsed. Without the money, the Taliban lacks sufficient funding.

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