Central Bank of Syria (CBS)

Overview

The Central Bank of Syria (CBS) serves as the Syrian Arab Republic's primary monetary authority and financial regulator. The CBS manages monetary policy, foreign exchange reserves, payment systems, and prudential supervision of the banking sector within a context of significant recent political transformation and ongoing economic recovery.

Institutional Status & Recent Transitions

• Established: Predecessor institutions dating to Syrian independence (1946); modern form under Syrian Constitution

• Jurisdiction: Syrian Arab Republic

• Primary Currency: Syrian Pound (SYP)

• Regulatory Model: Integrated central bank combining monetary policy, banking supervision, and financial regulation

• Recent Context: Significant institutional changes following December 2024-2025 regime transition

• Headquarters: Damascus, Syria

[SIGNIFICANT CONTEXTUAL CAVEAT]

This document reflects the CBS in the post-transition period following the fall of the Bashar al-Assad regime (December 2024) and the emergence of a new transitional government. The CBS has undergone substantial institutional disruption, leadership changes, and policy reorientation. Information reflects conditions as of April 2026 and may not fully capture ongoing institutional stabilization efforts.

Basic Identity

Classification

Inclusion Justification

What This Entity Oversees

Supervisory Functions

Monetary Policy & Currency Management

The CBS exercises monetary policy authority including:

• Monetary Targeting: Interest rate setting and monetary aggregate management

• Currency Issuance: Exclusive authority to issue Syrian Pound banknotes and coins

• Exchange Rate Policy: Official exchange rate determination and foreign currency management

• Inflation Control: Policy aimed at price stability (despite historical hyperinflation episodes)

• Liquidity Management: Reserve requirement setting and central bank lending facilities

Banking Supervision

The CBS exercises prudential supervision of:

• Credit Institutions: Banks, savings institutions, and credit cooperatives

• Capital Requirements: Supervision of banking sector capital adequacy

• Loan Classification: Standards for credit quality assessment and provisioning

• Liquidity Management: Monitoring of bank liquidity positions and stress resilience

• Authorization & Licensing: Grant and withdrawal of banking licenses

• On-Site Inspections: Examinations and audits of banking operations

Payment Systems & Settlement

CBS oversight of:

• Currency Circulation: Management of banknote and coin distribution

• Payment Systems: Operation and oversight of domestic payment and settlement infrastructure

• Interbank Clearing: Settlement of interbank transactions

• Banking Relationships: Maintenance of correspondent banking network (historically constrained by sanctions)

FATF Compliance Framework

Syria has been subject to FATF assessments and AML/CFT evaluations, though the security context has significantly constrained implementation:

• FATF Mutual Evaluations: Periodic assessments of AML/CFT framework effectiveness

• Deficiency Remediation: Efforts to address AML/CFT gaps (though compliance capacity limited during conflict)

• Technical Standards: Alignment with FATF 40 Recommendations and 9 Special Recommendations

AML/CFT Implementation Challenges

During the conflict period, AML/CFT enforcement was severely constrained:

• Institutional Capacity: Limited supervisory resources and inter-agency coordination

• Financial Crime: Widespread informal financial flows and sanctions evasion

• Documentation: Difficulty maintaining customer records and transaction monitoring

• International Cooperation: Limited ability to cooperate with foreign authorities due to sanctions isolation

Post-Transition AML/CFT Rebuilding

Following the December 2024 transition, the CBS is rebuilding AML/CFT frameworks:

• Financial Intelligence Unit (FIU): Reconstruction or establishment of FIU capacity

• Sanctions Compliance: Integration with international sanctions regimes

• Customer Due Diligence: Reinstatement of know-your-customer standards

• Suspicious Activity Reporting: Reestablishment of SAR collection and analysis

Sanctions Relief & International Reintegration (2024-2026)

Sanctions Lifting

Following the regime transition, major sanctions relief has occurred:

UK & EU Sanctions Lifting:

• UK and EU lifted sanctions against the Central Bank of Syria and related entities (early 2025)

Canadian Sanctions Easing:

• Canada eased sanctions regime against Syria

US Sanctions Modifications:

• May 23, 2025: US Department of Treasury OFAC issued Syria General License 25, authorizing previously prohibited transactions under the Caesar Syria Civilian Protection Act

• Partial relief permitting humanitarian and reconstruction transactions

SWIFT System Restoration

June 19, 2025: Syria completed its first international bank transaction through SWIFT since the start of the 14-year civil war

This milestone represents:

• Financial Reintegration: Return to global payment system infrastructure

• Correspondent Banking: Restoration of relationships with foreign banks

• Capital Flows: Opening of channels for international transactions and investment

Banking Crisis & Liquidity Constraints (2025)

Deposit Withdrawal Restrictions

The CBS implemented strict liquidity management measures:

February 2025:

• Cash withdrawal limits imposed: SYP 200,000 per transaction, per week (approximately USD 20)

August 2025:

• Limit increased to SYP 600,000 per transaction, per week (approximately USD 60)

Underlying Causes

Severe liquidity constraints resulted from:

• Reserve Depletion: Minimal foreign exchange reserves limiting currency supply

• Currency Depreciation: Syrian Pound weakened substantially against major currencies

• Capital Flight: Outflows of deposits during transition period

• Economic Disruption: Limited productive activity generating foreign exchange earnings

Policy Response Framework

The CBS implemented:

• Capital Controls: Restrictions on currency conversion and international transfers

• Parallel Market Monitoring: Efforts to suppress black market foreign exchange activity

• Import Financing: Mandatory centralized import financing to preserve foreign exchange

• Rial Exclusivity: Requirements for domestic transactions to use SYP (formal rial)

Economic & Security Context

Civil War & Transition Impact

Syria's banking and financial system experienced profound disruption:

• 14-Year Conflict (2011-2025): Extended civil war limiting normal economic and financial activity

• December 2024 Transition: Fall of Assad regime and emergence of transitional government

• Sanctions Isolation: International sanctions limiting foreign correspondent banking and capital flows

• Infrastructure Damage: Banking sector infrastructure requiring reconstruction

Reconstruction & Development Phase

Current period (2025-2026) characterized by:

• Institutional Reconstruction: Rebuilding of CBS capacity and banking sector infrastructure

• Sanctions Relief: Progressive lifting of international sanctions enabling reintegration

• Currency Stabilization: New currency and monetary reform initiatives

• Foreign Investment: Limited but emerging capital inflows for reconstruction

• International Cooperation: Engagement with IMF, World Bank, and regional development institutions

Regulatory Priorities & Outlook

Immediate Focus Areas (2026)

1. Liquidity Management: Addressing acute cash shortage constraints

2. Currency Stabilization: Successful implementation of new currency regime

3. Banking System Recovery: Recapitalization and stress relief for banking sector

4. AML/CFT Reestablishment: Rebuilding compliance frameworks and FIU capacity

5. Sanctions Integration: Alignment with sanctions relief conditions and international expectations

6. International Reintegration: Restoration of SWIFT, correspondent banking, and capital flows

Medium-Term Challenges

• Reserve Accumulation: Rebuilding foreign currency reserves from depleted base ($200 million)

• Credit System Reconstruction: Restoring banking sector intermediation capacity

• Inflation Control: Managing currency stability and controlling price pressures

• Institutional Capacity: Building supervisory and operational expertise

• Conflict Resolution: Supporting broader Syrian peace and reconstruction efforts

Regulatory Powers

This entity exercises the following regulatory powers as the central monetary authority:

Regulatory Role and Function

Leadership Transitions

December 2024 - March 2025:

• Maysaa Sabreen appointed as first female Governor of the Central Bank of Syria (December 30, 2024)

• Resignation on March 27, 2025

• Abdulkader Husrieh succeeded as Governor (April 2025 onwards)

Institutional Disruption Context

The CBS experienced severe institutional stress during the conflict period:

• Vault Depletion: As of December 8, 2024, CBS foreign exchange reserves reported at approximately $200 million—a dramatic decline from 2010 levels (estimated $18.5 billion by IMF)

• Reserve Losses: Extensive depletion resulting from years of civil conflict, sanctions, and state financial distress

• Operational Challenges: Limited capacity to conduct normal central banking functions

Governance

The CBS operates under:

• Governor: Executive leadership (current: [April 2025+] Abdulkader Husrieh)

• Board/Council: Policy-setting body coordinating monetary and supervisory decisions

• Executive Management: Senior leadership team overseeing operational divisions

• Banking Supervision Division: Prudential oversight of credit institutions

• Financial Regulation Division: Conduct and market supervision

• Monetary Policy Division: Interest rates and monetary operations

• Currency Management Division: Banknote production and circulation

Contact Information

• Headquarters: Damascus, Syrian Arab Republic

• Regulatory Authority: Supervision and licensing of banking institutions

• International Relations: Coordination with foreign regulators and international financial institutions

Legal Foundation

The CBS operates under Syrian national legislation and constitutional frameworks:

Primary Legal Basis

• Central Bank of Syria Law: Foundational legislation establishing CBS structure and mandate

• Banking System Laws: Framework regulating credit institutions and banking operations

• Monetary Policy Authority: Legal basis for interest rate setting and monetary operations

• Currency Law: Authority to issue and manage Syrian Pound currency

• AML/CFT Legislation: Anti-money laundering and counter-terrorist financing requirements

• Financial Regulation Laws: Prudential requirements for banking sector

Institutional Context

The CBS operates as:

• Central Bank & Monetary Authority: Exclusive issuer of Syrian Pound currency

• Banking Regulator: Prudential supervision of credit institutions

• Financial Supervisor: Oversight of payment systems and settlement infrastructure

• Reserve Manager: Custodian of Syria's foreign currency and precious metal reserves

• Government Banker: Fiscal agent for the Syrian state

Licensing and Authorization Relevance

The Central Bank of Syria (CBS) is a key licensing authority in Syria's financial system:

The licensing process typically involves assessment of capital adequacy, fitness and propriety of management, business plan viability, AML/CFT compliance frameworks, and IT systems readiness.

Payments and Money Movement Relevance

New Currency Initiative

In response to currency instability and loss of public confidence:

December 2025 Announcement:

• Syria's Central Bank Governor announced introduction of new national currency effective January 1, 2026

Currency Design:

• Six Denominations: New currency issued in small, medium, and large denominations

• Confidence Building: New design intended to restore public confidence in currency

• Economic Stabilization: Part of broader monetary stabilization program

Policy Objectives

The new currency initiative aims to:

• Restore Confidence: Replace heavily devalued and worn notes with new currency

• Stabilize Value: Anchor currency to reformed monetary policy framework

• Reduce Informality: Decrease reliance on foreign currency in domestic transactions

• Economic Recovery: Support reconstruction and economic stabilization efforts

Payment Systems Governed or Overseen

The CBS operates and/or oversees the national payment and settlement infrastructure of Syria. Specific systems include:

[Further detail on specific system names requires verification from official sources]

Relationship to Other Regulators

The Central Bank of Syria (CBS) operates within Syria's broader financial regulatory architecture and maintains relationships with:

Geography and Jurisdiction Notes

Important Departments and Divisions

Key Public Resources

Notes on Naming and Language