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Specialists: Lack of collateral payment of {40} trillion dinars outside banks

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Specialists: Lack of collateral payment of {40} trillion dinars outside banks

18/3/2018 12:00 a.m.

Establishment of a company to guarantee citizens' deposits

BAGHDAD/Huda al-Azzawi

The central bank of Iraq has resorted to issuing the bank deposit guarantee system, which includes the granting of leave by the bank to a shareholding company established in accordance with the provisions of the Companies Act, a system that has been welcomed by the Economic Community, because of weaknesses in the mobilization and deposit of funds with banks to take Their way into different investment channels, especially after the significant losses caused by financial crises in the State budget.

Participation of banks is obligatory the Director-General of the legal Department of the central Bank, Mustafa Ghaleb, said: "The central bank is currently working according to the technical, economic and legal feasibility of establishing the Iraqi deposit guarantee company with a mixed contribution from government banks Eligibility with the Company registration service of the Ministry of Commerce, in accordance with the provisions of the Companies Act No. 21 of 1997",

stating that this institution aims to to achieve the general interest of the community and to protect the funds of depositors and increase their confidence in the existing state banking sector, away from profit."

The company's proposed capital, amounting to 100 billion dinars, was 55 percent of its nominal capital from the contribution of state and private banks and branches of foreign banks, including the minimum state contribution of 25 percent and the remaining 45 percent will be offered to subscribe General on the basis of the provisions of article 39 of the Companies Act,

"pointing out that the participation of Iraqi banks is compulsory in order to ensure the continued existence an adequate balance within the Fund and its use to provide a financial envelope to ensure the balances of depositors in banks approved by the Central Bank of Iraq within the country."

Compensation in accordance with circumstances

"The company's funds can be invested in bank deposits, such as fixed deposits and the purchase of government securities as remittances," said the scary.

Treasury, bonds, and remittances issued by the Central Bank of Iraq purchased from the secondary market, as can be invested in borrowing Of banks or the issuance of loan bonds to support their own capital and resources, "the company will pay compensation for deposits with the banks according to the amounts and economic conditions of the country."

"It will be announced that the founding certificate of the company would be issued by the Ministry of Commerce after the end of the central bank," he concluded.

Of all the requirements for incorporation with the registration and public underwriting service under the Companies Act referred to."

Doubts and concerns of depositors

With regard to the culture of citizen dealings with the banking system, the Finance advisor to Prime Minister Dr. Mazhar Mohammed Saleh told the "morning" that the deal depends on the extent awareness of the Iraqi financial system, consideration of private sector projects and employment opportunities can contribute to lowering unemployment rates,

so The deposit system adopted by the Central Bank and approved by the Council of Ministers more than two years ago, which is expected to be completed in 2018, is aimed at encouraging citizens to save in banks instead of hoarding, an alarm that the percentage of the cash out of the banks is up to 80 percent, so for a They will be taken to state and private banks, and genuine guarantees are needed to encourage depositors to save.

Subscription and Contracting Parties

A professor of criticism at the University of Al-Mustanriyah, Dr. Faleh al-Zubaidi, said that the banking system should clarify the nature of the work on how to invest the unemployed citizens' funds and operate them transparently, without any ambiguity or confusion, within legal contracts that preserve the rights of the Contracting Parties Underwriting the company's contribution to the public, with the aim of seeking to increase its capital and contribute by attracting funding for the sale of its shares or issuing new shares to support the current capital.

Explaining, some of the amount of money outside the banking system, estimated at about 40 trillion dinars, is a typical case because Iraq is a developing country.

Known to increase the currency ratio in trading outside the banking system, pointing out that "investing this huge amount of money from the banking system" or money-making companies will contribute to revitalizing the Iraqi economy and providing jobs to reduce the high unemployment rates in the country."

Increased oversight and supervision on the main steps of the central bank to withdraw money from financial and banking institutions, the Director of payments at the central bank, Abdel Karim Mohamed L. "Sabah", stated that the payroll project, which would contribute to raising banking awareness Saving and relying on technical methods of transferring money and not relying on cash will determine the rate of conversion from dinar to dollar in card, noting that the card is used outside Iraq to be a catalyst for citizens to use anywhere In it as well as within best services,

he added that the financial inclusion strategy to be launched soon by the bank is aimed at the financial and banking services of each citizen in accordance with his/her needs."

The Director of payments concludes by saying: It is expected that the process of withdrawing chunky funds in the next phase will contribute to the development of the country's strategic projects with the institutions financial and banking, asserting that this would have a positive impact on all parties (state, financial institutions And banking, as well as the citizen.)

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