On April 14, 2021, the Council of Ministers, through Decision No. 36, granted a license to a group of partners to establish a private Islamic bank as a closed joint-stock company named “National Islamic Bank”.
The company’s capital is 25 billion Syrian pounds ($6.7 million at an exchange rate of 3,000 pounds). 10% of the capital will be offered for public subscription on the Damascus Securities Exchange at a later stage.
Two aspects of the bank’s establishment contract stand out. First, the largest shareholder, with a 49% stake, is a Syrian front company operating out of Lebanon called “New Generation Holding”. Lebanese commercial registry documents indicate that the company’s owners (shareholders) are Syrian nationals, one of whom is from the Gazal Hamwi family. Interestingly, the same family name appears in the bank’s founding documents as one of the individual Syrian shareholders, with Mustafa Gazal Hamwi holding a 4% stake. It’s likely that the two individuals are related.
In general, front companies help Syrian investors avoid Western sanctions by using the Lebanese arm of the company to interface with the outside world. They also help in avoiding taxes.
The second noteworthy point is that one of the contributors to the ‘private’ bank is a Syrian government entity represented by the Industrial Bank, which will hold a 10% stake. To the best of our knowledge, and further verification is needed, this is the first instance in Syria where a ‘private’ bank is established in partnership with the public sector. This move suggests that the primary driving force behind the establishment of the new ‘Islamic National Bank’ is the Syrian government sector, aiming to evade imposed sanctions.
*Special thanks to Albin Zakula for assisting us in identifying New Generation S.A.L (Holding) through the Lebanese commercial registry.
Note:
1- The company’s capital is $6.7 million (25 billion Syrian pounds at an exchange rate of 3,000 pounds), which is relatively small compared to other private banks at the time of establishment. The capital of Syria and Emigrants Bank in 2003 was $128 million (8.6 billion pounds).
2- According to al-Iqtisadi, Rasin Martini, one of the founders of the new bank in Syria, is the Director General of the Coral Martini Hotel in Aleppo and a co-founder of Julia Dumna and Martini Tourism Investments.