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Established in 2006 as a Community of Reality

Welcome to the Neno's Place!

Neno's Place Established in 2006 as a Community of Reality


Neno

I can be reached by phone or text 8am-7pm cst 972-768-9772 or, once joining the board I can be reached by a (PM) Private Message.

Established in 2006 as a Community of Reality

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Established in 2006 as a Community of Reality

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    Central Bank Governor: We have more than 70 trillion dinars outside the banking system for circulati

    Rocky
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    Central Bank Governor: We have more than 70 trillion dinars outside the banking system for circulati Empty Central Bank Governor: We have more than 70 trillion dinars outside the banking system for circulati

    Post by Rocky Mon 20 Mar 2023, 7:25 am

    Central Bank Governor: We have more than 70 trillion dinars outside the banking system for circulation
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    Baghdad today - Baghdad
    Today, Monday, the Governor of the Central Bank of Iraq, Ali Al-Alaq, revealed that there are more than 70 trillion dinars outside the banking system for circulation.
    The Governor of the Central Bank of Iraq, Ali Al-Alaq, said in a speech at the conference on activating lending programs in Iraq and its follow-up (Baghdad Today), that "we extend our thanks to the Association of Banks and the American Agency for Development for keeping pace with the banking sector and attempts to advance it and push it with directions that achieve the desired goals of the Iraqi economy." .
    He added, "Bank lending represents the cornerstone of the banking sector's work, whether with regard to its revenues, profits, and operation, or with regard to economic activities in all its forms."
    He pointed out that "the Central Bank was a pioneer in stimulating the lending capabilities of the banking sector, as we launched in 2015 an initiative, perhaps the largest in the history of Iraq, and it was represented by the allocation of 5 trillion dinars for industrial, agricultural and housing projects, as well as a trillion dinars for small and medium projects," noting that "this initiative It was able to greatly stimulate the Iraqi economy, whether at the level of some projects or in solving the housing problem by providing lending to the housing sector.
    He pointed out that "the amounts that have been lent so far amounted to about 13 trillion dinars, which is a very large amount," adding, "We are now in the process of evaluating these initiatives, benefiting from lessons, putting them in the right directions, and focusing them on specific goals."
    He added, "There will be a great focus in the next phase on financing small and medium enterprises, as well as with regard to projects or loans related to renewable energy, in an attempt to contribute to the Central Bank in facing climate challenges and the field of clean energy."
    He stressed, "Stimulating the banking sector towards enabling it to lend policies should not depend on the central bank, because this role of the central bank is an exceptional role dictated by some circumstances, but the first and foremost is that the banking sector is able by itself to assume and provide lending capabilities by bringing deposits and through his own financial ability.
    And he stated, "We will soon work on developing a national strategy for lending, and I presented the paper last month when I was outside the central bank, but realizing the importance of bank lending, I presented a paper at a conference at Al-Mustansiriya University on building rules for lending policies or the national strategy for lending."
    He pointed out that "these are very important and national issues because the issue of lending is not only related to the financial capabilities of banks, but rather is related to the work environment and its regulatory and legal conditions and many factors that lie outside the banking system, so it will be a joint strategy presented to the government and other parties to be a matter of their participation in Support this plan to provide the necessary decisions and procedures for its success.
    He explained that he "shed light on some signs that we must focus on in the next stage, which is that the ability of banks to lend depends on their ability to bring in deposits, and this is the role of the banking sector balancing between deposits and lending," noting that "indicators and data indicate that the banking sector It has reached the highest ceiling for lending because the percentage specified according to the instructions of the Central Bank is 70% of deposits, and the banking sector has almost reached this percentage, which requires that there be great efforts to attract deposits to the banking sector.
    And he added, "A lot talks about the limited bank lending, so that we do not blame the banking sector only because these are the capabilities available to it, which requires that there be a comprehensive and broad plan to attract deposits so that the banking sector can mobilize them towards granting loans."
    And he continued: “We have more than 70 trillion dinars outside the banking system for circulation, and this is a very large amount and represents a high percentage of the gross domestic product, so we must focus in the next stage on finding the necessary means to activate the deposit movement through several procedures in this regard, after we have completed Develop a comprehensive and strategic plan for electronic payment to expand the connection between these funds that lie outside the banking system and their uses, which can be large and wide in the event that these funds are attracted to the banking sector.
    The Governor of the Central Bank called on the banking sector to “be a key partner with the Central Bank in what it will do in terms of providing electronic payment methods on a broad national level,” adding: “Also, among the matters that fall on the banking system in this regard and direction, It is a review of banking services in quantity and quality, because banking services have come a long way despite the short life of some banks, but some of them have reached advanced stages and others still need to upgrade the level of banking services in different types and in the way of presentation.
    He added, however, by saying: “One of the remarkable things is that the survey conducted by the Arab Fund in examining the public’s reluctance to deal in the banking sector, contrary to expectations. The first reason was that services are complex and not readily available to citizens in the banking sector. The citizen and providing the necessary services with the best methods and techniques, and unfortunately he noticed that the citizen in some bank branches as if he is reviewing a complex administrative department or a court in the way of depositing or withdrawing amounts.
    He pointed out that "the Central Bank issued a wide circular to the banking sector in this field, and it will be the focus of our attention and field monitoring of banking services and the extent to which they keep pace with the standards and achieve the goals that we referred to."
    And he continued: “One of the issues that we call for to reduce the risks of borrowing due to the high rates is the default in repaying debts, and we will present the project to establish a company to guarantee loans, and this is very important and provides a great deal and high flexibility for the banking sector to provide loans,” stressing that “the banking sector needs to More geographical spread,” adding: “We commend some of the banks that have extended to wide networks inside Iraq, and we call on other banks to strengthen this spread in the regions of the country.”
    And he warned that "in order to reduce risks with regard to lending and in order for there to be a balance in sectoral growth, the credit portfolio or loans must be diversified, and this constitutes safety for the banking system and a balance in sectoral growth, and we note that there is a discrepancy in this area and this requires taking into account Consideration, and the best evidence of that collapse suffered by the Silicon Ghali Bank, due to a very clear reason, which is the credit concentration in a specific sector, and this was the main reason for the collapse of the bank.”
    Al-Alaq stressed that “the sectors in Iraq need stimulation, growth and construction, so focusing on a specific sector should not be the goal and the final result of bank loans, as happened now. Services are still at their lowest levels.
    He concluded by saying: "We need to build a national strategy for bank lending, led by the Central Bank and presenting it to the private banking sector to express observations and opinions, then we start working on it in order to achieve the goals mentioned."
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