THE CENTRAL BANK OF IRAQ ANNOUNCES THE COMPLETION OF A PIVOTAL STEP IN REFORMING THE BANKING SECTOR AND EXPANDING FOREIGN TRANSACTIONS.
The Central Bank of Iraq announced on Thursday that it has completed the main step in the comprehensive reform process for commercial and Islamic banks and branches of foreign banks operating in Iraq, after completing the submission of the required documents for review in accordance with the “minimum requirements”.
The bank explained in a statement received by “Al-Eqtisad News” that the minimum requirements included choosing one of the following three paths: continuing in the market as independent banking institutions, merging with other banking institutions, or exiting the market.
The Central Bank of Iraq confirmed that all Iraqi banks submitted the required documents according to the path they chose, which allows the bank to assess the level of compliance of each bank with the minimum requirements.
He explained that the coming months will see the addressing of any gaps or observations identified during the evaluation process, and that banks will work to complete the requirements for full compliance with banking reform standards.
As part of strengthening the role of private banks in supporting the economy, the Central Bank of Iraq announced the launch of a new initiative to expand the banks’ ability to support international trade for their clients. Banks that meet specific criteria, as assessed by the Central Bank, will be allowed to resume cross-border transactions and issue letters of credit in several international currencies, including the euro, the UAE dirham, the Chinese yuan, the Jordanian dinar, and others.
The bank indicated that this step complements the reform path it is leading to enhance confidence in the future of the Iraqi economy, deepen the global integration of the financial sector, and support sustainable economic growth in Iraq.