Market between banks do banking sector

Market between banks do banking sector  

3/4/2014 0:00

Limited to government banks and limitations between civil
BAGHDAD - Mustafa al-Hashemi

The existence of a market between banks of phenomena important to the economy of countries , but limited presence on a limited scale between government banks in Iraq to have much impact in the lack of progress in this important sector to take active role in the development process , and that - according to an economist - and the existence of this market between private banks is one of the key things that will determine the interest rates on the amount of lending and provide liquidity to them.

In this regard, said economic expert, Dr. Mohammed Saleh, said that the appearance of a market system between banks in Iraq exists and works by the State-owned banks to provide liquidity for large loans , while this market is non-existent or homogeneous and are dealt with in a limited civil between banks .

Saleh said in a statement ( morning) : The activation of this system and expand the circle of dealing it depends on the relationship of Iraqi banks ( government and private ) on the one hand and their relationship with the central bank on the other hand , pointing out that there is some sort of coordination and understanding between the private banks and the Central Bank while the relationship of private banks and government marred by the kind of inconsistency is reflected thus on the performance of the banking sector in general , which should take an active role in the current phase .

 confirmed that the system (inter-bank market) the interbank market is aimed at achieving the goals two major two provide liquidity for banks and determine the interest rate on lending amounts , indicating that the market is part of the monetary policy of the central bank .

 Salih noted that this market is not homogeneous in Iraq at the level of private banks because of that most of the private banks overwhelmed by the dye family .

Explained that the market activity between banks requires the existence of mutual trust among all banks is by providing the necessary data and private borrowers for large sums of their customers as well data relating to banking operations and activities carried out by those banks to the Central Bank of Iraq .

 He explained that the Central Bank's role is to supervise and monitor the performance of this market and maintain price stability .

Saleh said that the increase in space to deal with this market that will lead to the improvement of the conditions of banks to apply a broader standards of transparency , and to achieve a positive impact on the banking system in general .

 In the same context, noted academic economic Dr Majid Baidhani that does not activate the system will reflect negatively on the performance of the banking which is still waiting for his chance to integrate the economic process .

 said in a statement to the (morning ) reflected the importance of the existence of this market among private banks to enable the economy to rise strongly , because emerging economies Tterczaaly activity and effectiveness of banks in granting credit and the launch of various loans for small or medium-sized check her profits as well as improving the discipline of prices in the market.

According to analysts , Iraq lacks the ( interbank market ) and in force in other countries .

Thus in the case of the continued absence of such a market , the liquidity risk is the biggest risk will be that the procedures are to be faced by new legislation and implementation plans are made after extensive specialist studies to verify the feasibility .


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