Making an Easy Million: The Razzmatazz of Afghanistan’s Islamic Banking

When I interviewed him last week for a piece on the Kabul Bank crisis, Javed Babak, an Afghan freelance journalist, told me he planned to go to the bank after the Friday weekly holiday to withdraw his money. (Click here for France 24’s piece on Kabul Bank: Where business and political ties bind)

For the record, Babak has still not managed to withdraw his money from his Kabul Bank account, but not from lack of trying.


On Saturday, he went to four Kabul Bank branches on his way to work. “There were huge crowds. It was chaos. They were collecting bank cards and calling out the names of people when their turn came,” said Babak. “It was hard for me to give up my card and wait for so long.”


In the end, Babak landed at the Kabul Bank branch in Macroyan, an unlovely residential district in eastern Kabul. It happened to be next to a branch of Azizi Bank, Afghanistan’s second-largest commercial bank, where Babak also holds an account.


He did manage to get into Azizi Bank and withdraw 40 percent of his account, he tells me.


The Macroyan branch of the Azizi Bank was also crowded, says Babak. For one, many Afghans are withdrawing cash ahead of the Id ul-Fitr, the feast that marks the end of the Muslim holy month of Ramadan.


More interestingly though, many of the folks at Azizi were opening new accounts after either withdrawing from or closing down their Kabul Bank accounts.


An Afghan friend, who does not wish to be named, told me that while he was waiting at an Azizi branch manager’s office, the manager was fielding calls from private companies and NGOs trying to transfer their salary accounts from Kabul Bank to Azizi Bank.


Bad news at Kabul Bank seems to be spelling good news for Azizi Bank.


The real good news, I guess, is that Afghans don’t seem to be losing their faith in the banking system – at least not yet.

A Toaster? Think Cars, Apartments and Jewelry Instead

I wonder how this will change the way Afghan banks work.


There was a certain razzmatazz to Afghan banking over the past few years.


In banking style, Afghan banks lacked the covertness of Swiss banks or the niggardliness of US banks.


Reacting to my story on Facebook last week, a Chicago-based friend of mine joked that Kabul Bank never did deliver the toaster they promised at account opening time.


A toaster?! I laughed all the way to the bank.


Kabul Bank’s fifth anniversary was celebrated at my favorite, kitschiest wedding hall in the Afghan capital, the gloriously named Paris Palace.


Prizes at the fifth birthday bash included nine Kabul apartments and extravagant cash gifts.


Take that, Mr. Never Delivered My Toaster.


I remember the Kabul Bank billboards across the city roughly translated as “The Easiest Way to Make a Million”.

Don’t Call It a Lottery, Call It Bakht

In the Islamic Republic of Afghanistan of course everything is run on Islamic principles – even the banking. But really, it’s all just semantics.


Kabul Bank’s hottest product is – or should I say “was” - called “bakht,” which roughly translates as “fortune” in Dari.


Bakht account holders are automatically enrolled in a lottery for every deposit milestone they crossed. Except that you couldn’t call it a lottery since that’s a bit of a gamble.


And as everyone knows, gambling is haram, or Islamically forbidden. So, don’t call it a lottery, call it a bakht. Go figure. When I checked the Kabul Bank site, the last Bakht Draw Results were posted for July 2010.


Bakht draws are huge, by the way. They’re also conducted in one of the ubiquitous wedding halls that dot the city. Afghan celebrities are invited to pick the lucky draw and the proceedings are broadcast on a number of Afghan TV stations.


You can expect the best when the chairman, or former chairman these days, is a poker-playing, political kingmaker banker. (Click here for more on former Kabul Bank chairman, Sherkhan Farnood)

Don’t Call It a Lottery, Call It Qismat

By Kabul Bank standards, the Azizi Bank has been more austere. The bank’s Kabul headquarters boasts a mosque for staff use, sending out the right message for a conservative clientele.


But then one of Azizi’s hottest products is Qismat, or lucky account, which gives account-holders a chance of winning prizes such as cars and jewelry.


But don’t call it a lottery, call it qismat.


Azizi Bank’s chairman, Mirwais Aziz, is another super-rich, Dubai-based Afghan with extensive business interests in Afghanistan, primarily in the petroleum sector.


For Babak’s sake, and the sake of all Afghans transferring their life savings from Kabul to Azizi Bank, I hope Mr. Aziz has balanced his books and not lent foreseen amounts of cash to his family and friends.

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I deposited all my funds in azizi bank. Shareholders of azizi bank are strong businessmen unlock sher khan (kabul bank's main shareholder) who is popular for being a champ poker player - jawid
Kabul Bank has the same manager than Lehman Brothers...
Does Jérôme Kerviel work in Kabul?

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