Yemen president names new central bank governor, moves HQ to Aden

An emblem of the Central Bank of Yemen is seen on the bank's gate in Sanaa August 24, 2016. REUTERS/Khaled Abdullah

SANAA (Reuters) - Yemen’s exiled president Abd Rabbuh Mansur Hadi appointed Finance Minister Monasser Al Quaiti as head of the country’s central bank on Sunday, the state-run news agency reported.

The decree announcing the appointment included a decision to move the bank’s headquarters from the capital Sanaa to the southern port city of Aden, according to the report.

Hadi also appointed Ahmed Obaid Al Fadhli to replace Al Quaiti as finance minister, it said.

The central bank has been the last bastion of the impoverished country’s financial system amid a civil war and is effectively running the economy, according to central bank officials, diplomats and Yemenis on both sides of the war.

Hadi is backed by a Saudi-led Arab coalition, which has been waging an offensive trying to roll back gains made by the Iran-aligned Houthi forces since 2014.

His government asked international financial institutions last month to prevent central bank officials from accessing state funds held in overseas banks, reported on August 6 (not Saturday).

The government has accused the Iran-allied Houthis of squandering some $4 billion on the war effort from central bank reserves, but the Houthis say the funds were used to finance imports of food and medicine.

(This version of the story corrects the date reported when the government asked banks to prevent central bank officials from using state funds)

Reporting by Mohammed Ghobari; Writing by Hadeel Al Sayegh; Editing by Tom Heneghan