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Thread: Iraqi Bank to Open 5 more Branches

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    Exclamation Iraqi Bank to Open 5 more Branches

    Iraqi Bank to Open 5 more Branches




    May 28, 2015 in Banking & Finance



    By John Lee.

    The National Bank of Iraq plans to open five more branches in Iraq by the end of this year, in what Reuters described as a sign that there is still money to be made in much of the country despite civil war and low oil prices.


    Vice-chairman Ayman Abu-Dhaim told the news agency that two of the branches will be in Baghdad, and one near the Rumaila oilfield, adding:
    “Iraq is a strategic investment for us…If one can achieve this in the current conditions, imagine what one could do when the problems are solved.”


    He estimated that business in the Iraqi banking sector has fallen 20 percent because of the conflict and the fall in oil prices since last June.


    Reuters reports that the banks’s net income before tax in the first quarter of this year jumped 51 percent year-on-year to 2.94 billion Iraqi dinars ($2.5 million), while operating income rose 9 percent. Total assets increased 26 percent to 646.71 billion Iraqi dinars.


    The bank is 62-percent owned by Jordan’s Capital Bank, and currently has nine branches in Iraq, including two in the Kurdistan region.

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    Thats just showing off

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    Economic Adviser describes the work of private banks as "commercial" and calls to amend the law[/ltr]


    Baghdad / al-Suhail Ahmed

    [ltr] Counting economy experts, civil Banking Act without efficient making private banks just commercial banks do not participate in any development activity, and as pointed out that law and the Iraqi economic environment has not been studied well, drew out that the State-owned banks dominate 90% of the banking system's assets.

    Economic Adviser to the Prime Minister, the appearance of Mohammed Saleh in an interview for the "long" that "and said the main reason to make private banks commercial banks, not development is the Banking Act No. 94 of 2004, was built on the principle" Alankulosacksona "where the function of private banks and job brokerage and financial lead to generating economic activity and the activity functions of economic growth unlike the German banking system, which gives the right of banks to exercise real civil development activities and contribute to the production processes, "stressing the need to" be closer to the German school. "

    He continued by saying "We must arise changes to the Banking Act, especially Article 28 which prohibits the entry of private banks, real activities directly and do not mind owning some shares of financial tools and chips ownership."He noted that "the main reason for the weakness of legal private banking sector, where the law has not been studied Iraq's economic environment is good as well as the passage of 11 years on the law and needs to be adjustments," pointing out that "Iraq needs to develop and employ the money from various sources, particularly the credit weak. "

    And the launch of the Central Bank trillion dinars to finance private banks activities, the economic adviser to "give the Central Bank the amount of a trillion dollars to finance private banks activities is a positive signal to create homogeneity in the banking market because it Anglguet itself is no longer there harmony between private banks and government," he said. " national markets are usually one and one competition, and this closing weaker economic activity and create a split within the market. "

    He noted that the "State-owned banks dominate 90% of the banking system's assets and cash transactions daily وهيمصارفشاملةتمارسصيرفةالتنميةوالدخولفياستثماراتصن اعيةوزراعية، The few private banks Fmugodadtha A large monopoly of State-owned banks and this monopoly is the product. "

    He continued by saying that "there is a tendency to reform State-owned banks, and we need to have legislation law, restructuring and restructuring of ownership and repair itself is the reform of the Iraqi banking system."He noted that "the flow of money between the two devices Ahli bankers and the government is weak and there are overstocked on one side and deficit on the other side if there was a flow of funds for the said failures and banking problems."

    He concluded his speech by saying, "We have provided the framework for the recommendations of the Banking Act amendment towards improving banking environment, but it needs the will and accept, but we believe Anhsaiadl because the parliament to amend Egypt."

    For his part, said economic expert, Hilal Taan, in an interview for the "long" that "private banks in general, a newly established in Iraq and a small number relatively no more than 32 banks and these banks, despite being subject to the terms of the central bank in monetary policy and committed credit terms and the granting of loans, but the their problem is that their boards made up of a group of traders and thus their decisions are affecting the Bank's activities as well as the security and political situation is stable cast a shadow over the entire economic landscape and within the banking sector. "

    "The banking activity especially Ahli limited and most of its loans consumer and not productive and aim to make a profit to shareholders in the funds that banks capital," pointing out that "private banks do not have the possibility to give the agricultural sector loans, industrial or engage in large-scale investments."

    He noted that "funds of private banks capital is not great so it did not intervene in any investment, whether industrial or commercial only solution before them is a merger, where the banking merger sponsor activating the banking sector Ahli because when capital is a little thus will be lending the bank's ability few reducing their effects on economic activity, "pointing out that" in the last period happened cooperation between bankers and government sectors Ahli in terms of checks and some banking transactions, but still is not at the required level. "

    He continued by saying that "the marketing of banking services in Iraq weak and the Iraqi citizen still depends on the culture of criticism was not significant to the culture of deposit in banks and investment capital, as well as the fact that profits granted to applicants 4% and does not constitute an amount tempting them to invest their money in the banking sector," adding that "Banking Act needs to be reviewed according to developments that have occurred in Iraq's economic landscape."

    The study estimated that the local government banks' capital reached until October of 2012 last end, a total of 754 billion dinars, compared with more than four billion dinars for private banks, and investment balances in banks operating in Iraq recorded up to 10/31/2012, a sum nearly six billion dinars (5.947), the share of government banks which amounted to 4.929 billion, compared to 1.018 billion for private banks.

    Iraq's banking system consists of forty-three banks as well as the Central Bank and distributed by property between (7) state banks and 30 Islamic banks waged including seven in addition to six foreign banks.

    The CBI had announced (the 19 of May the current 2015), launch trillion dinars for private banks to finance small and medium enterprises loans, and increase the share of dollar sales for banking companies and foreign transfers, and the development of measures to to address the lack of liquidity in some banks.

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