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Afghanistan seeks bids to privatize troubled bank

Tuesday - 9/3/2013, 1:49pm  ET

KABUL, Afghanistan (AP) -- Afghanistan is trying again to privatize a major bank whose near-collapse rocked the country's fragile economy and served as an example of the country's rampant corruption.

Kabul Bank's 2010 demise and subsequent bailout represented more than 5 percent of Afghanistan's gross domestic product.

An independent report said the bank was run like a Ponzi scheme. Some $861 million in fraudulent loans disappeared into the pockets of associates of bank executives.

Regulators seized the bank, splitting it into bad and good parts and naming the good part New Kabul Bank.

The Ministry of Finance said Tuesday it was re-advertising New Kabul Bank for privatization.

Ministry media adviser Najib Manalai says a privatization attempt last year failed to draw acceptable bids.


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