Iraqi banking sector challenges and treatments in 2020
[You must be registered and logged in to see this image.]
On the occasion of the year 2020, given the special and new circumstances that our beloved country is going through due to the broad popular movement, legitimate demands for change, political and economic reform, confusion of visions and differing opinions on the reality and activity of our banks at the present time and the effects of events and lack of Stability in the working environment and because our banks are the first core link in the national economy we must clarify by analyzing and evaluating the business results of the banks 2018 and 2019 and the financial indicators that confirm that they have faced many challenges and business constraints and we will try in this paper to address them according to the data Our view of exceeding the requirements for 2020 in order to achieve stability and sustainability of banking in accordance with the central bank's strategy and monetary policy applications and to maintain the results of the work achieved even minimal if the current circumstances continue.
The structure of iraq's banking system
The structure of the banking system currently consists of 7 government banks, 76 commercial and Islamic banks, 25 commercials, 27 Islamists and 17 branches of a foreign bank.
The challenges and constraints of banking
First, based on official financial statements and indicators issued by the Central Bank for 2018, the banking sector suffers from weak banking activity, low liquidity, deposits, revenues and profitability in some banks, particularly private banks, in large proportions compared to previous years, and their share prices on the Iraqi Stock Exchange have also fallen due to the economic and financial crisis and economic recession that Iraq has suffered for known reasons.
S
Secondly, the total deposits of private banks amounted to 14% of the total deposits in the Iraqi banking sector with government banks at 86%, although the number of government banks is 7 and the private 69 commercial and Islamic banks, due to the concentration of deposits and government accounts with government banks.
Third, private banks invest 78% of the capital of the Iraqi banking sector, but only 22% of the sector's assets and 13% of profits.
Fourthly, the outstanding debt, which cannot be collected, amounted to 6 trillion dinars, which constitutes 15% of the total bank financing granted, and banks face significant obstacles in collecting them for judicial, legal and tribal reasons.
Fifth, the decisions of the Council of Ministers and the Economic Affairs Committee of the Council of Ministers on government support for private banks issued during the previous three years have not been activated and implemented.
Sixth, private banks are unable to employ excess liquidity in loans and financing for projects with a 15% credit balance.
Recommendations
First, raise the ceiling for bank financing in the Central Bank's Initiative for Small and Medium Enterprises and allow private banks to read investment projects of various types of real estate, housing, industrial and other types, allocating funds from the Central Bank's initiative to specialized government banks and ceilings covering the loan rates required by contractors and investors dealing with banks.
The Government has made the necessary legal adjustments to make private bank debt an excellent debt to be repaid, as is government debt.
Third, the Central Bank and the government are asking the United Nations Development Programme and Arab and international funds to work with Iraqi banks to produce financing programs for large-scale investment projects to attract foreign investors while granting them facilitation and incentive in accordance with Cabinet Resolution 254 for 2019.
Fourth, the Central Bank takes the necessary steps to mandate global audit and rating companies to classify private banks as sober, because without a bank rating, it is not possible to partner with close global banks for the purpose of financing large projects or consider Iraq's credit rating to be an approved rating of sober banks.
Fifth, because of the occupation of Mosul, Anbar and Salah al-Din by ISIS terrorist gangs, the 121 government and private banks have suffered damage and losses of 1 trillion dinars, and a large part of them are shareholders' funds and deposits to customers that the government requires to compensate.
6- Activating all cabinet decisions to support the banking sector, support reconstruction and investment issued in 2019 and previous years and the decisions of the Economic Affairs Committee to support private banks, in particular the following:
1• The Ministry of Finance and government banks are required to open bank accounts to ministries and state departments in private banks and not to restrict them to government banks under its book 207 on 31 January 2019.
2• Activating the decision to allow ministries and government departments to open documentary credits in private banks up to $50 million without going through the Ministry of Finance and the Iraqi Bank of Commerce. Economic Affairs Committee Resolution 967 dated 21/10/2018.
3• Activating the Decision of the Economic Affairs Committee No. 253 for 2015 regarding the acceptance of sukuk approved by private banks to pay insurance, customs duties and taxes.
4• Activating Cabinet Resolution 245 for 2019 on the promotion of reconstruction and investment.
5• Activating the Cabinet Resolution No. 378 for 2018 on the collection of government fees in state departments through electronic payment.
6• Activating the decision of the Economic Affairs Committee No. 272 on 19/5/2015 to support private banks, particularly in relation to their approval by government banks.
7• Activating cabinet resolutions No. 313 for 2016 and 218 for 2017 on the localization of employees' salaries and asking government departments to settle their salaries according to their wishes and not directing them to settle salaries in government banks exclusively.
8• Activating the decision of the Economic Affairs Committee No. 253 on 3/5/2015 to accept the approved instruments of private banks to collect government taxes and customs duties.
Seventh, the Ministry of Finance will compensate banks that have been damaged by the occupation of the provinces by ISIS terrorist gangs. She's under arrest at the Central Bank.
Iraqi
[You must be registered and logged in to see this link.]
[You must be registered and logged in to see this image.]
On the occasion of the year 2020, given the special and new circumstances that our beloved country is going through due to the broad popular movement, legitimate demands for change, political and economic reform, confusion of visions and differing opinions on the reality and activity of our banks at the present time and the effects of events and lack of Stability in the working environment and because our banks are the first core link in the national economy we must clarify by analyzing and evaluating the business results of the banks 2018 and 2019 and the financial indicators that confirm that they have faced many challenges and business constraints and we will try in this paper to address them according to the data Our view of exceeding the requirements for 2020 in order to achieve stability and sustainability of banking in accordance with the central bank's strategy and monetary policy applications and to maintain the results of the work achieved even minimal if the current circumstances continue.
The structure of iraq's banking system
The structure of the banking system currently consists of 7 government banks, 76 commercial and Islamic banks, 25 commercials, 27 Islamists and 17 branches of a foreign bank.
The challenges and constraints of banking
First, based on official financial statements and indicators issued by the Central Bank for 2018, the banking sector suffers from weak banking activity, low liquidity, deposits, revenues and profitability in some banks, particularly private banks, in large proportions compared to previous years, and their share prices on the Iraqi Stock Exchange have also fallen due to the economic and financial crisis and economic recession that Iraq has suffered for known reasons.
S
Secondly, the total deposits of private banks amounted to 14% of the total deposits in the Iraqi banking sector with government banks at 86%, although the number of government banks is 7 and the private 69 commercial and Islamic banks, due to the concentration of deposits and government accounts with government banks.
Third, private banks invest 78% of the capital of the Iraqi banking sector, but only 22% of the sector's assets and 13% of profits.
Fourthly, the outstanding debt, which cannot be collected, amounted to 6 trillion dinars, which constitutes 15% of the total bank financing granted, and banks face significant obstacles in collecting them for judicial, legal and tribal reasons.
Fifth, the decisions of the Council of Ministers and the Economic Affairs Committee of the Council of Ministers on government support for private banks issued during the previous three years have not been activated and implemented.
Sixth, private banks are unable to employ excess liquidity in loans and financing for projects with a 15% credit balance.
Recommendations
First, raise the ceiling for bank financing in the Central Bank's Initiative for Small and Medium Enterprises and allow private banks to read investment projects of various types of real estate, housing, industrial and other types, allocating funds from the Central Bank's initiative to specialized government banks and ceilings covering the loan rates required by contractors and investors dealing with banks.
The Government has made the necessary legal adjustments to make private bank debt an excellent debt to be repaid, as is government debt.
Third, the Central Bank and the government are asking the United Nations Development Programme and Arab and international funds to work with Iraqi banks to produce financing programs for large-scale investment projects to attract foreign investors while granting them facilitation and incentive in accordance with Cabinet Resolution 254 for 2019.
Fourth, the Central Bank takes the necessary steps to mandate global audit and rating companies to classify private banks as sober, because without a bank rating, it is not possible to partner with close global banks for the purpose of financing large projects or consider Iraq's credit rating to be an approved rating of sober banks.
Fifth, because of the occupation of Mosul, Anbar and Salah al-Din by ISIS terrorist gangs, the 121 government and private banks have suffered damage and losses of 1 trillion dinars, and a large part of them are shareholders' funds and deposits to customers that the government requires to compensate.
6- Activating all cabinet decisions to support the banking sector, support reconstruction and investment issued in 2019 and previous years and the decisions of the Economic Affairs Committee to support private banks, in particular the following:
1• The Ministry of Finance and government banks are required to open bank accounts to ministries and state departments in private banks and not to restrict them to government banks under its book 207 on 31 January 2019.
2• Activating the decision to allow ministries and government departments to open documentary credits in private banks up to $50 million without going through the Ministry of Finance and the Iraqi Bank of Commerce. Economic Affairs Committee Resolution 967 dated 21/10/2018.
3• Activating the Decision of the Economic Affairs Committee No. 253 for 2015 regarding the acceptance of sukuk approved by private banks to pay insurance, customs duties and taxes.
4• Activating Cabinet Resolution 245 for 2019 on the promotion of reconstruction and investment.
5• Activating the Cabinet Resolution No. 378 for 2018 on the collection of government fees in state departments through electronic payment.
6• Activating the decision of the Economic Affairs Committee No. 272 on 19/5/2015 to support private banks, particularly in relation to their approval by government banks.
7• Activating cabinet resolutions No. 313 for 2016 and 218 for 2017 on the localization of employees' salaries and asking government departments to settle their salaries according to their wishes and not directing them to settle salaries in government banks exclusively.
8• Activating the decision of the Economic Affairs Committee No. 253 on 3/5/2015 to accept the approved instruments of private banks to collect government taxes and customs duties.
Seventh, the Ministry of Finance will compensate banks that have been damaged by the occupation of the provinces by ISIS terrorist gangs. She's under arrest at the Central Bank.
Iraqi
[You must be registered and logged in to see this link.]
Today at 6:18 am by Rocky
» “His need no longer exists.” Parliamentary Finance confirms the necessity of returning the retiremen
Today at 6:17 am by Rocky
» To communicate with the bases... 12 directives from Al-Sadr, including blocking numbers for non-gove
Today at 6:15 am by Rocky
» In an interview with "Baghdad Today"... an Iranian researcher reveals the importance of Haniyeh's vi
Today at 6:14 am by Rocky
» After it was 63 trillion in 2023... the 2024 budget deficit will rise to 80 trillion dinars
Today at 6:13 am by Rocky
» Parliament reveals the date of the first evaluation of the governors and determines the party respon
Today at 6:11 am by Rocky
» The President of the Republic informs Al-Araji and Al-Basri: Momentum must be mobilized to eliminate
Today at 6:10 am by Rocky
» Can the Federal Court sue others? A legal clarification of its response mechanism to abuse
Today at 6:09 am by Rocky
» Despite promises to soon stop burning gas.. What is the secret behind Iraq renewing the Iranian gas
Today at 6:07 am by Rocky
» Advisor to Al-Sudani: The dollar is on the way to further decline, and 70% of Iraqi traders have ent
Today at 6:06 am by Rocky
» Iraq exported more than 99 million barrels of oil last February
Today at 6:04 am by Rocky
» Barzani “gives good news” to Kurdistan employees: salaries, land, and loan exemptions
Today at 6:03 am by Rocky
» Alia Nassif: Nour Zuhair returned to the port of Umm Qasr to make deals.. An influential Shiite forc
Today at 6:02 am by Rocky
» The Prime Minister announces the movement of nearly 500 stalled projects
Today at 6:00 am by Rocky
» A government strategy to enhance investments.. Iraq is on the verge of a new era of economic develop
Today at 5:59 am by Rocky
» Ranging between 20% and 50%.. The Kurdistan government decides to reduce service fees, customs dutie
Today at 5:58 am by Rocky
» Al-Sudani: The reform approach in the security services is an integral part of reform in other secto
Today at 5:56 am by Rocky
» Everyone in Iraq wants the Sudanese visit to Washington to be successful, even the factions!
Today at 5:55 am by Rocky
» Sources and experts expect the agenda.. in his bag is the Baghdad dollar and the factions’ truce, bu
Today at 5:54 am by Rocky
» The decision to raise gasoline prices arouses the ire of drivers...a reminder of the large demonstra
Today at 5:53 am by Rocky
» Parliamentary services: 3 important hospitals in Baghdad will enter service at the end of the year
Today at 5:52 am by Rocky
» Iraq signs a contract to supply Iranian gas for a period of five years
Today at 5:50 am by Rocky
» Parliament adds a voting paragraph on amending the Penal Code to its agenda
Today at 5:49 am by Rocky
» His political advisor: We are not afraid of Sudanese entering the elections alone
Today at 5:48 am by Rocky
» Parliamentary services explain the reasons for the rise in real estate prices in Baghdad
Today at 5:46 am by Rocky
» Attia, criticizing the government's decisions: "The citizen's feathers will be ruffled without servi
Today at 5:45 am by Rocky
» Parliamentary Communications: Zain Iraq and Asiacell did not pay their debts
Today at 5:44 am by Rocky
» The Governor of Karbala announces the imminent establishment of the largest industrial city in the c
Today at 5:43 am by Rocky
» A government determination to end the issue of displaced persons in the middle of this year
Today at 5:42 am by Rocky
» Iraq buys gas from Kurdistan to generate electricity
Today at 5:41 am by Rocky
» Parliamentary signatures to include an amendment to the internal regulations to decide the choice of
Today at 5:40 am by Rocky
» In Basra.. a demonstration against foreign workers in Iraqi companies (video)
Today at 5:38 am by Rocky
» Al-Samarrai: Presidency of Parliament is an entitlement to the constituents, and calling it a “frame
Today at 5:36 am by Rocky
» Electronic food supplies in 6 governorates... covering 11 million Iraqis and “writing off” about 700
Today at 5:34 am by Rocky
» Corruption of the Ministry of Transport.. Representatives express their surprise at the minister’s s
Today at 5:32 am by Rocky
» The biggest supporter of the invasion of Iraq.. The death of former US Senator Joe Lieberman
Today at 5:31 am by Rocky
» Iraq is ranked “late.” A list of the most and least safe Arab countries for women
Today at 5:30 am by Rocky
» utube MM&C 3/26/24 Iraqi Dinar - IQD Update - Strength Dinar - Automation ASYCUDA - World Bank - D
Yesterday at 8:49 am by Rocky
» The Council of Ministers exempts the Gulf Interconnection Authority from guarantee fees: it is a gov
Yesterday at 8:48 am by Rocky
» The Iraqi government raises the size of the 2024 budget, and Parliament is “surprised”
Yesterday at 8:46 am by Rocky
» Popular Movement: We have many economic options away from American hegemony
Yesterday at 8:42 am by Rocky
» The Oil Parliament stresses the need to transfer part of the revenues to the producing governorates
Yesterday at 8:41 am by Rocky
» It will cover 14 regions in eastern Iraq.. A deputy reveals the “border electricity” project
Yesterday at 8:40 am by Rocky
» Experts Warn Mass Migration Threatens US Food Security
Yesterday at 8:37 am by Bama Diva
» Al-Fateh: America occupies Iraq through agreements
Yesterday at 8:37 am by Rocky
» Anger in Iraq over a "sudden decision"... and a reminder of a "general strike" that paralyzed the co
Yesterday at 8:34 am by Rocky
» Parliamentary Committee: Parliament is discussing today a decision that “disturbed” the Iraqis
Yesterday at 8:33 am by Rocky
» Ministry of Electricity: Our production will reach 27 thousand megawatts by May
Yesterday at 8:31 am by Rocky
» Diagnosing the “most important” problems in the oil file between Baghdad and Erbil.. What is the rel
Yesterday at 8:30 am by Rocky
» The Iraqi Fiqh Academy and the Sunni Endowment issue a fatwa to pay Zakat al-Fitr
Yesterday at 8:28 am by Rocky
» The National Bank of Iraq continues its digital transformation by launching its new banking system a
Yesterday at 8:26 am by Rocky
» Parliamentary Investment and the Central Bank are discussing the housing initiative
Yesterday at 8:25 am by Rocky
» The Prime Minister announces the restart of 500 suspended projects
Yesterday at 8:23 am by Rocky
» Al-Barti assesses the region's employees: Your salaries are insured and will be paid after resettlem
Yesterday at 8:21 am by Rocky
» Iraqi-American discussions in anticipation of the Sudanese visit
Yesterday at 8:20 am by Rocky
» Iraq and Turkey hold meetings in Ankara to discuss technical issues related to the development road
Yesterday at 8:17 am by Rocky
» A government parliamentary agreement to support budget revenues and governorate allocations for inve
Yesterday at 8:16 am by Rocky
» Oil: The gas sector is witnessing great development
Yesterday at 8:15 am by Rocky
» A Kurdish-French agreement to develop trade and economic relations
Yesterday at 8:13 am by Rocky
» Exchange companies in Mosul demand that they be entered into the currency selling window
Yesterday at 8:12 am by Rocky
» Minister of Finance to the Czech Ambassador: Iraq enjoys a more attractive business environment and
Yesterday at 8:10 am by Rocky
» Iraq and Britain sign an agreement in the field of the stock market
Yesterday at 8:08 am by Rocky
» A new parliamentary meeting with the Minister of Finance to discuss these files
Yesterday at 8:07 am by Rocky
» A parliamentary committee discusses these files with the Director of the Projects Department in the
Yesterday at 8:06 am by Rocky
» Central Bank sales exceed $257 million today
Yesterday at 8:05 am by Rocky
» Parliamentary Finance and the Minister of Planning discuss governorate allocations and investment bu
Yesterday at 8:04 am by Rocky
» Planning: We are discussing with representatives of the World Bank the work plan of the Social Fund
Yesterday at 8:02 am by Rocky
» Parliamentary meeting with the Governor of the Central Bank and the Director of the Real Estate Bank
Yesterday at 8:01 am by Rocky
» Parliamentary Finance: The 2024 budget reached 228 trillion dinars
Yesterday at 7:57 am by Rocky
» Barzani "gives good news" to Kurdistan's employees: salaries, land, and loan exemptions
Yesterday at 7:57 am by Rocky
» Parliamentary Economy: The decision to raise fuel prices targets this class
Yesterday at 7:54 am by Rocky
» The President of the Republic: Iraq is an important investment environment
Yesterday at 7:53 am by Rocky
» From the accounts of Saddam's Republican Guard... Iraq returns approximately 7 billion dinars to the
Yesterday at 7:52 am by Rocky
» Al-Abadi: Muqtada al-Sadr did not leave politics.. He reached a dead end
Yesterday at 7:49 am by Rocky
» Nassif: The leaders of the framework abandoned Al-Sudani because of his recent successes
Yesterday at 7:48 am by Rocky
» Baghdad stresses the continued danger of ISIS and the importance of Washington's efforts to combat i
Yesterday at 7:47 am by Rocky
» Parliamentary Oil: It is necessary to transfer part of the revenues to the oil-producing governorate
Yesterday at 7:45 am by Rocky
» The Sudanese government zeroes in on the legacy of its predecessors
Yesterday at 6:28 am by Rocky
» The Human Organ and Tissue Transplantation Law is ready for its second reading
Yesterday at 6:26 am by Rocky
» 1,500 active civil organizations in Iraq
Yesterday at 6:25 am by Rocky
» The position of Speaker of Parliament awaits decision
Yesterday at 6:23 am by Rocky
» Water for peace...the water crisis in Iraq
Yesterday at 6:21 am by Rocky
» Fiscal and monetary policies succeed in undermining the parallel dollar
Yesterday at 6:20 am by Rocky
» Kurdistan.. Attempts to circumvent the "Federal" decision and an invitation to the Baghdad governmen
Yesterday at 6:17 am by Rocky
» “Iraq warned the US Treasury to leave the dollar.” Parliamentary Finance: The exchange rate will con
Yesterday at 6:16 am by Rocky
» The Iraqi government issues new decisions
Yesterday at 6:14 am by Rocky
» Barzani: We will not give up our constitutional rights, and tomorrow we will take a decision that is
Yesterday at 6:12 am by Rocky
» A researcher in political and security affairs describes the decision to increase the price of gasol
Yesterday at 6:11 am by Rocky
» The Council of Ministers addresses the Finance Ministry to appoint the families of those who died du
Yesterday at 6:09 am by Rocky
» 100 thousand dinars as a “Eid gift” for retirees.. A parliamentary request before the Sudanese (docu
Yesterday at 6:08 am by Rocky
» Al-Sudani confirms that more than 490 projects have been moved and returned to work in record time
Yesterday at 6:07 am by Rocky
» Parliament reveals three facts about the decision to raise the price of fuel: It targeted “luxury” w
Yesterday at 6:05 am by Rocky
» In detail...the problems of the oil file between Baghdad and Erbil
Yesterday at 6:04 am by Rocky
» International skepticism about Iraqi agriculture... Modern irrigation succeeds, but it will not be e
Yesterday at 6:02 am by Rocky
» For those who love traveling by the Iraqi train... buy the ticket with your mobile phone and 50 new
Yesterday at 6:00 am by Rocky
» Regional and international challenges hinder the path of the Iraqi economy towards stability
Yesterday at 5:59 am by Rocky
» A severe educational crisis threatens Iraqi children with a “bleak future”
Yesterday at 5:57 am by Rocky
» Investing in Iraq's natural wealth is a step towards economic integration
Yesterday at 5:56 am by Rocky
» Revealing the advantages of the “Hasabe” project: It is safe and provides great services to employee
Yesterday at 5:55 am by Rocky