Not Your Typical Bank Collapse.

• Author: McKinley, Vern

The Tragedy of Kabul Bank

By Abdul Qadeer Fitrat

496 pp.; Page Publishing, 2018

Since the beginning of the global financial crisis in 2007, dozens of books have been written about the collapse of individual financial institutions. Many of these have focused on large institutions in the United States such as Lehman Brothers, Bear Stearns, and AIG. Fewer books have been written about banks that collapsed in other advanced markets, such as the United Kingdom. Fewer still have been written about banks in emerging markets.

Kabul Bank in Afghanistan was one such institution that failed in the aftermath of the September 11, 2001 terrorist attacks, the ensuing U.S. invasion of Afghanistan, and the subsequent "nation building" exercises by U.S. forces. Its story is the subject of The Tragedy of Kabul Bank.

The book's author is Abdul Qadeer Fitrat, the former governor of Afghanistan's central bank, Da Afghanistan Bank (DAB). After graduating with a degree in economics from a top university in Pakistan, Fitrat pursued a Master's Degree at Wright State University in Ohio. I am particularly interested in his story because I worked in Afghanistan intermittently from 2004 to 2009 and met Fitrat on a few occasions.

After some chapters tracing his difficult upbringing in northeastern rural Afghanistan and his time in Pakistan and the United States, Fitrat discusses his early career when he led Banke Millie, a small Afghani bank, beginning in 1993. He began his first stint leading DAB as acting governor in 1995, during a period of triple digit inflation. That stint came to an end when the Taliban took power in 1996: "Tens of thousands of people fled Kabul by cars, trucks, motorcycles, and horse-driven carts; people even fled on foot."

The overthrow of the Taliban allowed him to return to DAB as first deputy governor in early 2002. This would lead a few weeks later to his first meetings with Afghani President Hamid Karzai just after Karzai ascended to the presidency. In that meeting, Karzai pleaded with Fitrat to stay in Afghanistan: "Please do not go back; we will put you in a good position. It would be better to serve your nation here."

Fitrat would again become the leader of DAB in early 2008, this time as the official governor. His task was monumental as he describes it: "When I started work at the Central Bank in January 2008,1 felt it was in serious need of fundamental reforms almost in every direction."

Instability begins/ By November 2008, the Afghani...