The banking sector. Reality and reform
13/6/2016 12:00 am
Abdalshrh Mohammed Hindawi
Although most of the space on its acquisition of the banking landscape in Iraq, but the State banks still face a lot of challenges that prevented play in the developmental process of construction required by the country especially with the intensification of the financial crisis and the Government's attempt to close the budget deficit by resorting to external borrowing and issuing bonds.
Perhaps the bold step taken by the Cabinet recently and of exempting Government and bankers are the agricultural and Industrial Bank and the trade and Iraqi Mesopotamia represents a fresh start to change the reality of these banks, which over the past years – also emphasizes banking officers-ineffective but, some see it was disruptive to some important steps that could increase the effectiveness of the banking sector, both public and private.
This case has created a negative environment kept private banks to contribute to the investment process, as long as through special banks owners complained of the dominance of State-owned banks and not to allow them, depriving private banks of many privileges that he can get, including bank transfers, because 90 percent of such remittances are among State banks in the distribution (10%) remaining on More than 50 community banks, as well as depriving private banks deal approved instruments, such issues will impact negatively on citizen confidence in private banks, industry and Government banks resort to financial dealings even though the banking of these banks are lower than those offered by private banks.
Here I hope to understand my words as an attempt to discredit the General or specialized government banks as much as a call for the promotion of these banks that dealt with bureaucracy with CBI initiative to grant the private sector a loan of 6 trillion Iraqi dinars to support industry, agriculture and housing by giving citizens soft loans amounting to 50 million tops, and may have caused those alberokratMatter of delaying the granting of loans to beneficiaries, and this was probably one of the reasons for the Cabinet to include them in the reform process.
And the process of change is not necessarily due to suspicions of corruption as promoted by some, but because these managers have exhausted all they have developmental visions and ideas that in turn led to the events of the State of relaxation and SAG performance with the absence of strict monitoring and control by senior management at Bank branches scattered across Iraq, so find the references to those branches a lot of negative images that should not be under Return.
And here it must be said that the reform process will not be complete change of senior leadership to Government banks departments only, and that was an important first step in this direction, but a comprehensive review process required for all of the details of the reality of State banks in Iraq, begin restructuring and subdue all actors performed by these banks to mail order or renewal of automation, we're still seeing a lot of business.
Bank's going on as the old traditional paper systems causing much delay in processing citizens especially those concerning withdrawals and deposits and get certified instruments and remittances, etc..
This as well as the possibility of applying the system won tempting for employees of banks and be based on the daily achievement not as broken, incentives that will pay the employee to make a greater effort to improve the economic reality on the one hand and, on the other hand contribute to reducing blackmail citizens and reduces red tape and have breakfast and tea.
The other thing that you can point him here, is the need to open broad prospects in front of private banks that need to review its performance that it suggests that some of these banks are small shops in mission in the Central Bank's daily auction and buy dollars and then sold in the markets and quick profits without having any bank operations have an impact on the national economy,
so the Department of private banks find appropriate treatments such as asylum Banking integration with a view to strengthening its portfolio, this would allow them to compete with the public sector banks under the reform and opening policy pursued by the Government of Iraq's banking performance activation and activated about a year, which has been enhanced by the Cabinet's approval of the establishment of a specialized company to guarantee deposits in an initial capital of 100 billion dinars, the existence of such underwriters would encourage citizens to save rather than prevailing in Iraq compactness phenomenon due to lack of confidence in the banking system General In The country.
In summary, the process of banking reform will ultimately lead to the creation of a sophisticated banking system represents a fundamental pillar of development and has the ability to compete with banks through their service quality to customers and supporting investment projects in various fields.