Afghan government tries to freeze shareholders' assets after run on bank

Shareholders in disgraced Kabul Bank banned from selling property, says central bank governor

The government of Afghanistan is attempting to freeze the assets of some of the shareholders of Kabul Bank, the disgraced financial institution that has suffered days of panic withdrawals from depositors amid a major corruption scandal.

Abdul Qadir Fitrat, the governor of the central bank, said that orders had been given to prevent the sale of properties and other assets owned by shareholders who took personal loans from the bank.

He told a press conference that Kabul local authorities had banned the sale of properties owned by shareholders.

With the bank run into its fifth day, Fitrat also appealed for calm, saying the bank still had enough cash to cover the needs of depositors who wanted their money back. And while he said no public money had yet been used to prop up the bank, it was prepared for a bailout.

"The central bank will provide any support Kabul Bank requests," Fitrat said.

But Khalilullah Frozi, the owner of 28% of the bank, said no one had told him not to sell his assets and he was free to leave the country if he wished.

Frozi was the flamboyant chief executive of the bank until last week when he was ousted by the central bank along with the bank's chairman, Sher Khan Farnood, who also holds 28% of the available shares.

It was not clear whether any steps had been taken to prevent the sale of assets outside Afghanistan, particularly in Dubai where hundreds of millions of dollars were spent on luxury property with many of the houses on the artificial Palm Jumeirah development subsequently given to members of the Afghan elite.

The United Arab Emirates has said it has not received any requests from Kabul to freeze assets owned by Afghans.