Currency window .. Where to?!
30/4/2018 12:00 am
The citizen is touching these days the recovery of the Iraqi dinar and its stability against the exchange rate of the dollar, and perhaps the latest central bank measures were "straw that broke the camel's back" according to the common proverb.
The most important question that now arises and looks for a clear answer is, "What does the official exchange rate mean to the parallel market price?"
What are the possible implications for this new reality?
Which prompted me to write this column what the writer of the economic thinker d. Mzahr Mohammed Saleh about this phenomenon, which he has predicted and predicted what happened and the truth has occurred.
The position of the "currency window" will be a laboratory for economic analysis of the potential results after this equal exchange rate, as most private banks began to fear the possibility of diminishing profits borrowed from this window and obtained by the price difference.
The reason is certainly because the "window of the currency" is the main supplier of private banks to meet the operating cost of their budgets of the profits you get.
We talk here about the economic phenomenon impartially and regardless of the vulnerability of the window of criticism and continuous monitoring and miscellaneous accusations I say regardless of this and that because this Diagnosis may sometimes occur and sometimes exaggerated and it is important to analyze this phenomenon in an unstable economy.
Thus, the banks' perception and perception of these concerns the real fears of the decline in profits at a time when it accounts for more than 90% of its profits to cover operating expenses, and because banks have relied on these profits without providing other banking products because of the high risk, For the provision of other banking services.
The reason is that loans and deposits, which are the basis for moving products and banking performance, have been disrupted by risks, because the factor of confidence is missing between banks, the public of depositors, banks and the large number of borrowers.
On this reality what is required of these banks if there were no profits to avoid loss?
The answer is to be guided by the contents and the importance and objectives of the program of financial inclusion is to cover all segments of the community banking services that contribute to moving the sources of development through small and medium-sized enterprises, so you find that the attention of the Central Bank of this program appeared to appear results emerge quickly.
The settlement of salaries, which led to the expansion of the use of modern technology through the spread of credit cards will contribute to strengthening the financial position of banks, and enables them to re-activity and the return of confidence to absorb the money sting.
This important program, which is celebrated by the week of Arab financial inclusion these days, is the real starting point for returning banks to the right path in providing banking services for which they were established, but provided that support continues with legislation guaranteeing the rights of depositors and lenders alike.
As a reminder, the possibility of any financial shock or other whirlwind may confuse securities, prices will return to volatility, and our wishes for constant price stability.