JAN. 9 2014 (The Conway Bulletin) — Uzbekistan’s financial authorities have shut Samarkand Bank for undisclosed violations, media reported, the second bank it has closed in the last two months.
After the authorities withdrew its trading license, Samarkand Bank, just like Credit Standard Bank before it, transferred its assets to the state-owned People’s Bank of Uzbekistan.
There is, typically, a political reason, for this sort of targeted action in Uzbekistan and in the case of Samarkand Bank, the clue is, possibly, in the name.
Shortly after the Uzbek authorities cut the license of Credit Standard Bank in November 2013, allegations appeared on Uzbek websites linking it to Gulnara Karimova, the embattled eldest daughter of Uzbek President Islam Karimov. She is currently locked in a power battle with rival clans and analysts said the closure of Credit Standard Bank may have been an attempt to undermine her.
The Karimovs are part of the Samarkand clan, named after Uzbekistan’s second city. Samarkand Bank’s name and origins suggest a link between the bank and the clan. Disbanding it will play into the hands of the so-called Tashkent clan, headed by various members of Uzbekistan’s intelligence service.
Once again, politics may well be the root cause of another banking closure in Uzbekistan.
ENDS
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(News report from Issue No. 167, published on Jan. 15 2014)