Acquires private banks with a weak currency auction post good and Mesopotamia

17/07/2013 (00:01 pm)


BAGHDAD / Adel Saffar

Confirmed the association of private banks that the efficiency of private banks and their ability to foreign remittances helped her progress on the government banks at an auction sale of foreign currency, called upon the Finance Committee in the House of Representatives bank Rasheed and Rafidain to expand تعاملاتهما ERA sell the currency daily, noting that private banks acquires accounted for 80% of the amount of daily currency auction,

While the expected "Sansar Capital" specializing in asset management in developing countries, to achieve the Iraqi banking sector significant growth in assets and profits over the next decade.

The executive director of the Association of private banks Abdul Aziz Hassoun: that the central bank window open auction in front of all banks licensed private and government at the time showed the state banks failing in this area has not been able to make transfers to the outside because it was under Chapter VII, so given the largest share Eligibility banks being has wide latitude in the completion of foreign trade.

He said Hassoun said in a statement singled out the "long": you must take the government banks role in the currency auction noting that after the withdrawal of Iraq from Chapter VII appeared thus an invitation to play an important role in this area and so do not be private banks alone monopolized to work despite the fact that recent has a wider and better outlets as well as advanced systems that lack a government banks.

For his part, said a member of the Committee Amin Hadi in a press statement: "The private banks account for 80% of the amounts of foreign currency auction at the Central Bank of Iraq, while still Rasheed and Rafidain banks entering at an auction sale in a very weak currency."

He said Hadi "We let in more than once banks to engage strongly in the auction currency daily Central Bank of Iraq being the extensive branches of several in the provinces, and thus by Fruaehma they can distribute the largest amount of foreign currency in the provinces to end the state of control at the dollar by some private banks or small businesses. "

He continued that "the Commission has not seen so far on the real reasons behind the unwillingness of banks to engage strongly in the currency auction even though the he brings additional financial banks."

He explained that "the fear of the issue of dealing in the dollar or adjust the mechanism to sell it may be one of the main reasons behind the reluctance of banks to accept the currency auction as in private banks." To that predicted "Sansar Capital" specializing in asset management in developing countries, to achieve the Iraqi banking sector significant growth in assets and profits over the next decade, based on many factors, foremost of which there is an economic environment is huge and powerful, and the spread of credit, and improve the security situation in the state.

The new report on the banking sector in Iraq issued by the company that with the IMF forecast growth of GDP in Iraq, a rate of 9% during the current year, it is expected to keep the banking sector in particular, in the level of steady growth during the next few years, the report noted the role of the further spread of credit in promoting the growth of the banking sector. In this regard, the report highlighted what came in the World Bank study, which he explained that domestic credit Iraqi linked to GDP has remained constant at about 9% of GDP by the end of 2011, compared to 55% of the average GDP in the Middle East and North Africa.

Also saw domestic credit associated with GDP growth of almost 89%, according to a compound annual growth rate in the period from 2009 to 2011.

According to data released by the Central Bank of Iraq, the cash credit, such as loans and overdrafts rose significantly by a compound annual growth rate to reach 50% in the period between 2006 and 2011.

The report analyzes in detail the development of the private banking sector in Iraq, by highlighting the five largest private banks in terms of deposits.

The report shows that as a result of support resulting from strong economic growth and higher credit spread, these five banks witnessed a growth in total net income by 207% during the years 2010 - 2012.

The policy lack of militancy impact in the increase of capital, resulting in the reduction of earnings per share growth, although it still has a strong position, along with the growth of dividends collected to 111% during the period from 2010 to 2012.

The polls report property unusual characteristic of the Iraqi market, clear image in the banks with the highest rates of returns for equity and growth rates, since you are buying goods with the lowest multiples of evaluation, and that's what makes Sansar Capital believes that this indicates a lack of efficiency of the market, which provide an opportunity for interested persons . It also sheds light on the financial situation of the Iraqi banks, and shows high profits equity earnings ratios in Iraqi banks significantly, according to figures provided, which approached some banks in the ratio of 60%.

In spite of significant growth, but it will have to Iraqi banks to overcome some of the challenges the task, if they want to continue on the path of growth distinct pace, as happened during the past five years.


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