Private Banking Spreading in N.Korea

Private banks are sprouting up in North Korea, even offering automatic teller machines in Pyongyang, according to a source.

The source, who travels frequently to and from Pyongyang, said money-lenders who have grown rich are opening small banks.

The regime is persuading them to invest their fortunes by opening banks that will funnel the money into the legitimate economy. The money-lenders often grow very rich by monopolizing profitable businesses with the support of the regime. There are ATMs at five hotels in Pyongyang, the source added.

But other North Koreans are still stuck in dire poverty due in part to endless extortion from officials, and discontent is growing as the gap between rich and poor widens.

A source said on Sept. 22, the death anniversary of regime founder Kim Il-sung's wife Kim Jong-suk, wreaths laid at her tomb in the national cemetery were damaged and flowers were torn into pieces and scattered.

The regime mobilized the State Security Department, the Ministry of People's Security, and the Guard Command, but reportedly failed to catch the perpetrators.