United World: Could you give us a brief history of the bank?

Mr. Ghaffar: Umma Bank was founded as Bank Di Roma in 1907. In 1969, it was Libyanized, with the Libyan government retaining 51% of its shares. In 1970, it was nationalized completely and till this day it is state-owned. Its capital is LYD100 million and total assets are about LYD 3 billion. We have 55 branches and 2,500 employees.

United World: Since the nationalization in 1970, how has the bank developed?

Mr. Ghaffar: At the time (1970) the Libyan economy was dominated by the private sector, therefore, our business was predominantly with them and we once dominated 50% of the private market share. In the 1980s, the economy underwent a nationalization process and all our business transferred to the public sector. We played a key role in the financing of many public sector companies; we financed them, but we are not shareholders.

United World: What have been your most important contributions in the public sector?

Mr. Ghaffar: Today, things are returning to how they were in the past; we are moving towards privatization. A number of the public companies have either been dissolved or sold to the private sector. Today, we are allowed to participate or buy some of the shares of some of these private companies, for example, the Moutahida (United) Insurance Company, in which we are shareholders. We are currently trying to acquire shares in Buraq Air, the private airline company. We will also participate in a newly established transportation company.

United World: What kind of services do you provide for your clients?

Mr. Ghaffar: We provide the basic services of any bank. We have recently made arrangements with gasoline stations, whereby any of our clients can use pre-paid cards that we issue for that specific purpose.

United World: Do you provide specific services to foreign investors?

Mr. Ghaffar: Yes. For example, there is a new tourism project under construction near Maitega airport, worth about LYD250 million. The company in charge of this project is a Pakistani-Emirate one, called Hasho. We are providing them with their financial requirements. There's also a study that has yet to be finalized concerning the construction of a cement plant by a British Company, and another one by a Malaysian Company; we will play an important role in financing them if and when this takes place. Our goal in the near future is to improve the services extended to our customers by providing new services like internet banking. We have also signed a contract to purchase ATM machines.

The sanctions imposed here had a negative impact on our infrastructure, and we were left behind in terms of technology for that reason. This is why we didn't have new ATM machines for decades. There's also a new national payment plan headed by the Central Bank, which will hopefully be executed in 2006. It is divided into five parts and the most prioritized one is the issue of credit-card machines, which is a necessity for tourists in the country, because many prefer not to carry around cash.

United World: How would you define your current and future relationship with foreign investors, and American ones in particular?

Mr. Ghaffar: I am very optimistic about the business relationship the country is developing with the United States. Libya has vital qualities for any foreign investor, particularly in terms of security. Libya is an emerging market, and there is a lot of room for profitable businesses projects. I am sure that foreign investors can play an important role in re-building the country. At one point, we were corresponding with 20-30 banks in the United States, but many of these banks have changed ownership or merged with others. Since the sanctions were lifted, we have been trying to establish new relationships with these banks; of course there are a lot of technical issues that need to be settled first. We had numerous accounts there, and there are balances that have been there for more than twenty years. The problem is that during the sanctions period, our communication with these banks broke down and we lost track of what happened with them. We are currently at the stage of collecting as much information as possible from these banks in the United States. There are still some reconciliation problems with regards to these banks; there are millions upon millions of dollars involved, so it will take some time before everything is cleared up. We have received bank representatives from American bank offices in Egypt and they have expressed a willingness to re-establish a relationship with us. As I mentioned earlier, our relationship with American banks in the 1970s was excellent and we are looking forward to re-capturing it. There are a lot of opportunities involved in that regard because Libya has seen the return of several American oil companies to the country.

United World: From a more global perspective, how do you see the evolution of the banking sector in general, in terms of reform?

Mr. Ghaffar: We are lagging behind because of the sanctions period we went through, but we are doing everything we can to improve what we have. We have many ambitions; we can cope with foreign banks but it will take a while. However, we have a very high literacy rate; we have the human resources to implement and modernize the sector and we are confident it will happen, but it will take a while. We believe that Umma Bank will be amongst the pioneers of the commercial banks in Libya. There is also a new committee which was formed to evaluate the financial soundness of all the Libyan banks, and in the near future, some will be privatized. We are on the right track and we hope that in the future, we will be able to compete with foreign banks that will eventually open branches here. We are aware of what is going on in the outside world, in terms of new legislation, new technology, money-laundering, compliance etc. We are training our staff to become more familiar with these new concepts.

United World: Could you please tell us a little about yourself?

Mr. Ghaffar: I was appointed to UMMA Bank in 1985. I graduated from the University of Gharyounes. I hold a Master's degree in accounting and worked in the accounting department when I first arrived to this bank, as well as a department in charge of our branches, auditing and inspection, and the international banking department. Then I became the General Manager.
I would like to say that Libya has a very important geographical position with great climate. We are a friendly and generous people. Things have started returning to normal and are improving since the lifting of the sanctions. The question of progressing in technology is being addressed, with primary grade students having to learn how to use a computer and English is being taught. I would just like to say that you are all welcome here and it is a very safe country; any foreigner that does settle here will want to do so for a long time.

United World: Thank you very much for your comments.

Mr. Ghaffar: Thank you.