Progress in Iraq’s Banking Sector: Central Bank Governor Announces Key Developments
Baghdad, Iraq – In a significant update for the financial landscape, Ali Al-Alaq, Governor of the Central Bank of Iraq, reported that 20 Iraqi banks are now engaged in direct transfer operations utilizing eight foreign currencies. This announcement marks a pivotal advancement in Iraq’s banking practices, enhancing the nation’s integration into the global financial system.
Al-Alaq shared insights during a press briefing regarding the recent quarterly meetings conducted with representatives from the American Federal Reserve and the U.S. Treasury Department, held in Dubai. He emphasized that the discussions yielded positive outcomes, with the Central Bank receiving commendations for its initiatives aimed at refining the external transfers system. These initiatives are designed to transition operations to international standards that prioritize safety, transparency, and organization.
"This transformation represents a historical milestone for Iraq," Al-Alaq stated, outlining the evolution from the traditional window system to a more dynamic platform model, followed by the engagement with correspondent banks. His comments underscore the progressive nature of the banking sector’s modernization efforts.
As part of this new system, the 20 Iraqi banks are facilitating direct conversions with international correspondents in eight foreign currencies, showcasing an ambitious expansion in cross-border financial transactions. Meanwhile, other institutions that have yet to join this framework are undergoing rehabilitation processes. Al-Alaq noted that these banks are collaborating with an international consulting firm to meet defined criteria necessary for participation in external transfer activities.
Contrary to concerns over regulatory constraints, Al-Alaq assured stakeholders that there are no new penalties imposed on the banks. Instead, there has been widespread approval from international entities, particularly concerning the mechanisms governing cash dollar sales.
The Governor further emphasized the importance of showcasing these successes, which he believes will enhance the perception of the Iraqi banking sector and positively influence the rapport with international financial institutions.
In summary, the developments outlined by Al-Alaq reflect a transformative period for Iraq’s banking sector, marked by increased operational capabilities and improved international relations. As this progress continues, it promises to foster a stronger economic environment conducive to investment and growth.
