Yemen Monitor / Newsroom:
The Central Bank of Yemen has approved raising the minimum interest rate on new savings deposits in Yemeni Rials at commercial banks to 18% annually, a step aimed at regulating the deposit market and increasing the attractiveness of saving in the local currency.
The bank explained that the decision will come into mandatory effect starting Sunday, April 12, 2026, while granting banks the freedom to determine interest rates for various deposit terms, provided they do not fall below the specified percentage.
Regarding foreign currencies, the Central Bank indicated the liberalization of interest rates on deposits, leaving them to each bank according to its policies and market conditions. This also applies to interest rates for lending operations, which are subject to the banks’ credit assessments and risk levels.
It emphasized that adherence to the specified minimum interest rate on Rial deposits is mandatory for all banks, with the Central Bank reserving the right to take regulatory and legal action against violators.
The decision exempted Islamic banks, which will continue to operate according to financing and investment formulas compatible with the provisions of Islamic Sharia, provided that the decision applies to new contracts concluded after it comes into force.
This trend coincides with moves to reactivate financial sector institutions, as the Board of Directors of the Deposit Insurance Corporation held its first meeting in the temporary capital, Aden, following the completion of the transfer of the corporation’s headquarters from Sana’a and the restructuring of its board of directors.
The meeting was chaired by the Governor of the Central Bank, Ahmed Ghalib, with the participation of representatives from financial and banking authorities. Attendees discussed ways to activate the corporation’s role and enhance its efficiency to support financial stability and restore confidence in the banking sector.
The meeting also touched upon several regulatory files, including the approval of the administrative structure and financial and investment regulations, increasing capital, appointing a general manager for the corporation, and working to restore its membership in relevant regional and international organizations.
These steps come as part of broader efforts to rebuild the banking system in Aden and enhance coordination between its institutions, contributing to economic stability and driving the recovery path during the coming phase.
