BGG & wmawhite
Flashback Friday – Crush Expected When Kuwaiti Banks Reopen Today
Crush Expected When Kuwaiti Banks Reopen Today
March 24, 1991|From Reuters
KUWAIT CITY, Kuwait — Thousands of Kuwaitis are expected to jam the country’s banks today when they open for the first time since the end of the Iraqi occupation.
Customers will be allowed to withdraw funds and to swap pre-invasion money for a new currency issued to make more than $1 billion in pre-invasion dinars stolen by the Iraqis worthless
“We expect a rush of people,” said Issam Asousi, an executive with the Bank of Kuwait. He said it could be a chaotic first week because customers have a lot of questions about their accounts.
Kuwaiti banks continued operating during the seven-month Iraqi occupation under managers brought in from Iraq, but they have been closed since the U.S.-led alliance ousted the Iraqi army from Kuwait a month ago.
When the banks reopen today, customers will be able to withdraw up to 4,000 Kuwaiti dinars, equivalent to about $14,000 at pre-invasion exchange rates from their accounts, and to exchange a like amount for foreign currency.
Balances of customers’ accounts will go back to what they were on Aug. 1, a day before the invasion.
Clients will not be able to exchange Iraqi currency issued during the occupation, when Baghdad pegged the rates of the strong Kuwaiti dinar to the far less valuable Iraqi dinar.
The new Kuwaiti money will be exchanged for old at a one-to-one rate.
BGG ~ Thanks to wmawhite for some facts on the subject:
Hi BGG, Just thought I would drop you an email. I listened to the call, and was interested in what was said about Kuwait, if I may – I will add my 2 cents worth.
You were spot on with what you said, I have a close friend who’s father made a killing on the KWD. He bought from people who had fled the country and he paid pennies on the dollar (we are in Australia). He took the chance that Iraq would be kicked back out and he was right.
When the money was reinstated, he exchanged it for AUD at a rate in the mid 3s. The interesting thing about it is, Iraq invaded in November 1990 (I think), they were kicked back out at the end of Feb 1991, the banks reopened with a brand new KWD in late March,
that’s not a bad time frame to get a currency designed, printed and made ready to use, also the time that the old KWD was valid was initially only for 2 months, then extended to 6, so it was valid until Sept 1991, interesting I think.
Also the other thing that seems to be a “fact” in Dinar land is Bill Clinton used the Kuwait RV to pay off the debt. However, Clinton was not President in 91, he did not take office until 93, even I know that and I am an Aussie.
Anyway thanks for the site and enjoy listening to your calls. Kind Regards,