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W6nnews.com ==== وطن === تاريخ النشر – 2026-03-10 13:37:00
Revaluating bank assets in Sudan: Will it reveal the truth or save the banking system? A reading of the Bank of Sudan’s decision to re-evaluate assets and its implications for the future of the financial system after the war. Omar Sayed AhmedO.sidahmed@gmail.comIndependent banking, financial and finance expert March 2026After years of structural imbalances and the shock of the war that struck the financial sector to its core, the Central Bank of Sudan issued directives to re-evaluate banks’ assets according to independent standards. While the step seems necessary to restore transparency and reveal the true financial reality of banks, the most important question remains: Does this step represent the beginning of a real reform of the banking system, or is it merely a late diagnosis of a deeper crisis hitting the structure of Sudan’s economy? Elaph newspaper indicated in a recent report that the Central Bank of Sudan issued new directives to banks and financial institutions requiring the re-evaluation of fixed assets according to independent professional standards, in a step aimed at addressing the effects of the war, enhancing transparency, and preparing the banking sector for the stage of restructuring and reform. According to the report, the expected negative valuation differences may reveal the need to support capital or restructure some banks, paving the way for rebuilding confidence in the banking system and moving towards the economic recovery phase. The decision – as the report indicates – is not limited to being a purely accounting measure, but rather carries broader economic and reform dimensions. The Central Bank has obligated banks to seek the assistance of independent expert houses to conduct evaluation operations, while adhering to international accounting standards, and submitting detailed reports to the Central Bank on the evaluation methodology, its results, and its effects on the financial statements. The Central Bank also reserved the right to review evaluations or request a re-evaluation when necessary, in an attempt to enhance levels of disclosure and oversight. However, this decision comes in an exceptional context in which the Sudanese banking system faces unprecedented challenges as a result of the war. Many banking assets were damaged, some branches and infrastructure were destroyed or disabled, economic activity declined, and supply chains and operational operations were subjected to severe disruptions. Estimates indicate that many of the book values of assets no longer reflect the actual economic reality, which makes re-evaluation a necessary step to rebuild a more accurate financial picture of the banks’ conditions. However, the importance of the decision lies not only in its accounting results, but in the questions it raises about the future of the Sudanese banking system itself. If the revaluation of assets will reveal the true size of losses and capital gaps in some banks, then the basic question becomes: Is this step alone sufficient to save a banking system that was exposed to a deep structural shock as a result of the war and the accumulation of decades of institutional imbalances? This article starts from this question, trying to analyze whether the process of revaluing assets represents the beginning of a real reform of the banking system, or is it merely a technical step that reveals the depth of the crisis without addressing its roots. First: The background of the crisis – how did the Sudanese banking system reach the brink of collapse? To understand the implications of the recent decision, It must be placed in the context of the structural crisis that the Sudanese banking system has been suffering from for many years. The problem is not only related to the decline in the value of some assets as a result of physical destruction or disruption of economic activity, but rather its roots go back to structural imbalances that have accumulated over decades within the structure of the state’s political economy. During the past three decades, a large part of the banking system arose in an economic environment characterized by a high degree of overlap between political authority and financial institutions. The pattern of empowerment economy that prevailed during the years of the bailout rule led to the expansion of the number of banks without a corresponding development in governance and risk management standards. Instead of the banking sector performing its natural role in allocating resources efficiently, it often became a tool for redistributing economic rents within networks of power and influence. Over time, this reality was reflected in the weak capitalization of a number of banks and the high degree of concentration in financing portfolios, in addition to the reliance of some banking institutions on political relationships more than on sound banking foundations. The Sudanese banking sector also faced other challenges, represented by its relative isolation from the global financial system as a result of the long sanctions, and the resulting decline in relations with correspondent banks and the high costs of financial compliance. When the war broke out, this fragile structure found itself facing a double shock. Significant physical assets have been destroyed or disabled, including banking branches and infrastructure linked to the financial system. At the same time, economic activity declined sharply and daily banking operations were disrupted in large areas of the country. Public confidence in the banking system also suffered a major shake, as depositors faced difficulties in accessing their savings, and the monetary economy expanded outside official channels, which led to a reduction in the role of banks in financial intermediation. Second: What will the actual revaluation of assets reveal? When banks begin to reevaluate their assets according to independent professional standards, it is likely that negative valuation differences will appear in the balance sheets of a number of banking institutions. These differences may reflect a decline in the market value of real estate, operational headquarters, or equipment that was damaged during the war or lost part of its economic value. But the real impact of this process goes beyond simply adjusting the numbers in the financial statements. The decline in the value of assets may lead to the erosion of equity in the balance sheets of some banks, and may reveal large capital gaps that were hidden behind old book values. In more severe cases, some banks may appear in a negative solvency position, meaning that the value of their liabilities exceeds the value of their assets. In such cases, it becomes extremely difficult for the bank to continue operating without recapitalization or restructuring. Also, the revaluation may reveal an overvaluation of some of the real estate collaterals used in exchange for financing, which increases the amount of credit risks in the banking system. Therefore, the revaluation essentially represents a financial diagnosis process that may reveal the true extent of the losses incurred by the banking sector during the years of crisis and war. Third: Why will the revaluation alone not save the banking system? Despite the importance of this step, it alone is not sufficient to save the Sudanese banking system. The basic problem does not lie only in the book values of assets, but in the crisis of confidence and the economic structure within which the financial sector operates. The war led to the expansion of the monetary economy outside the banking system, as direct transactions with liquidity became more common as a result of the disruption of banking services in many regions. Also, important economic sectors, such as gold trade and some unregulated commercial activities, operate to a large extent outside the institutional framework of the financial system. Under these circumstances, the ability of banks to perform their traditional role in financial intermediation between savers and investors is weakened. Rebuilding relations with the global financial system also represents an additional challenge, as it requires high levels of transparency and compliance with international standards, which requires deeper institutional reforms than simply re-evaluating assets. Fourth: What should actually happen to rebuild the banking system? If re-evaluating assets represents a first step in diagnosing the conditions of banks after the war, then the next stage must include a comprehensive program to restructure the banking sector. The first of these steps is to recapitalize viable banks, whether through owners’ contributions, the introduction of new investors, or through government or international support within the framework of reconstruction programs. Merging some banks may also become a necessary option to enhance efficiency and reduce operational costs, and perhaps liquidate institutions that cannot be saved without burdening the financial system. Additional. Reforming banking governance and supervision remains a basic condition for the success of this process, as confidence in the financial system cannot be rebuilt without enhancing transparency and the independence of credit decisions. In addition, it will be necessary to rebuild the financial infrastructure and modernize payment systems and digital banking services, in addition to reintegrating Sudanese banks into the global financial system by adhering to international standards of compliance and transparency. However, the success of any program to restructure the banking sector will depend not only on the clarity of policies or the availability of the reform will, but also on the practical ability to implement technical steps. What is required in an environment that is still experiencing a state of war and instability. The problem of evaluation in light of an ongoing war. But there is a practical question that is no less important than the technical aspects of the decision: How can a comprehensive evaluation process be implemented for banking assets in light of a war that is still ongoing for the third year? Re-evaluating assets in accordance with international professional standards usually requires basic conditions such as the relative stability of the markets, the possibility of field access to the assets, and the availability of market data that can be relied upon to determine the fair value. However, many of these conditions appear to be absent in the current Sudanese case. Some of the banking assets are located in areas that have witnessed widespread destruction or are still witnessing intermittent clashes, which makes accessing them or assessing their actual condition extremely difficult. Also, the real estate and commercial markets that residents rely on to determine market values are suffering from a state of severe stagnation and turmoil, which makes estimating real prices a matter of estimation rather than accurate measurement. In addition, revaluation in an economy experiencing deep uncertainty may reflect temporary values related to war conditions more than it reflects the long-term economic value of assets. In such cases, market values may change significantly once security conditions improve and economic activity returns. Therefore, the revaluation process, despite its importance, will remain in part a preliminary estimate of unstable conditions, which forces monetary authorities to deal with its results with caution, and perhaps consider it a transitional phase that paves the way for more accurate evaluations in the post-war phase and markets stabilize. Conclusion In the end, the asset revaluation process may reveal more than decision-makers expected. It will not only rearrange the numbers in the financial statements, but may put the entire Sudanese banking system before a moment of confrontation with its economic and institutional reality. If this process will show the true size of the capital gaps and accumulated losses, its true value lies in what comes next: the difficult decisions that cannot be avoided. Either this step will turn into a starting point for rebuilding a more solid and transparent banking system, based on the rules of governance and economic efficiency, and capable of supporting the reconstruction of the Sudanese economy; Or it remains just a technical measure that reveals the crisis without addressing its roots. What Sudan is facing today is not just a banking crisis, but rather a crisis of an entire economic system formed through decades of structural distortions and dependence on the rentier economy and power. Therefore, the reform of the banking sector should not be understood as a limited financial reform, but rather as part of a broader project to rebuild the economic state itself. In this context, the revaluation of assets may be a small step on its face, but it may become – if followed by the necessary reforms – the beginning of a real transformation towards a new financial system that keeps pace with the post-war stage and restores confidence in the institutions of the Sudanese economy.
