The Shareholders and Board of Supervisors are committed to a high level of corporate governance and to ensuring that the Bank’s management practices are always aligned with the principles of good governance.
Shareholders
The Bank has four major shareholders, each with an equal ownership percentage. The shareholders operate under a policy of non-interference in management decisions and the Bank’s operations. The positive reputation and widespread business and government relations of the Bank’s shareholders in Afghanistan have contributed significantly to the success of the institution. Each shareholder appoints one person to the Board of Supervisors.
Shareholder |
Beneficial Shareholder |
Type of Company |
Incorporated |
Board Members |
Ownership % |
Asian Development Bank (ADB) |
N/A |
Development Bank |
Manila, Philippines |
Hasib Ahmed |
25 |
Afghanistan Investment Partners Corporation (AIPC) |
Nemat Khwaja, Zaher Yaqubie |
Investment Company |
Delaware, USA |
Gokhan Erkal |
25 |
Horizon Associates |
Mohammed Abrahim Mohib |
Holding Company |
Delaware, USA |
Hamidullah A. Mohib |
25 |
Wilton Holdings |
Lutfullah Rahmat |
Holding Company |
Cayman Islands |
Lutfullah Rahmat |
25 |
Board of Supervisors
The major purpose of the Board of Supervisors is to ensure that the Bank’s overall strategic and financial objectives are met and that the risks associated with a financial institution operating in Afghanistan are managed and monitored.The Board of Supervisors comprises the Chairman, four shareholder representatives, and one independent director. The Chairman is also an independent director, in compliance with Central Bank regulations. The shareholders and Board members are committed to increasing the Board to nine members and are actively recruiting three additional independent directors. Brief biographical profiles of the six current directors are included in this annual review.
The Chairman is a non-executive director and is responsible for leadership of the Board and ensuring its effectiveness. The four shareholder representatives are appointed by the respective shareholders of the Bank and represent the interests of these shareholders. Finally, the independent directors are expected to bring impartial judgment to the Board through their expertise in the financial world as well as governance experience. Independent directors are elected annually while directors who are shareholder representatives are appointed every four years.
The Board has established two committees: the Compensation Committee and the Risk Committee. A third committee, the Audit Committee, reports directly to the shareholders as specified in the Law of Banking in Afghanistan and Central Bank regulations. Each committee has a formal charter to guide its activities. The role of these committees is explained in more detail in the ‘AIB Committees’ section.
The Board of Supervisors meets monthly: four times in person and the balance by conference call. The Compensation and Risk Committees meet four times a year in person with occasional conference calls, while the Audit Committee meets four times annually.
Management Board
The Board has delegated day-to-day operational responsibilities to the Chief Executive and the Management Board. The Management Board is a formal entity with its role and responsibilities defined in the Law of Banking in Afghanistan and Central Bank regulations. The Board comprises: the Chief Executive, Head of Commercial Banking, Chief Operating Officer, Chief Information Officer, and Chief Financial Officer. The Management Board meets frequently concerning matters of policy, procedures, and operations. Brief biographical profiles of Management Board members are given on page 12 of this report.In addition to the Management Board, the management structure of the Bank includes the Head Office Credit Committee and the Head Office Risk Committee. Both operate under defined charters and sets of policies and procedures approved by the Board of Supervisors and the shareholders.