With low oil prices .. Government banks in the country acquires 60 percent of deposits !!

With low oil prices .. Government banks in the country acquires 60 percent of deposits !!

26-03-2018 10:14 AM

With low oil prices .. Government banks in the country acquires 60 percent of depositsBaghdad News –

Experts predicted the increase in the volume of Iraqi bank deposits during the current year after the adoption of a budget reduced the rate of austerity that the government since 2014, following the crisis of low oil prices and the occupation of large areas of Iraq by the «Da’ash».

The banking sector showed that the balance of deposits in the banking sector declined in 2015 and 2016 to reach 62.4 trillion dinars ($ 52 billion), and 60 percent of total bank deposits, especially in government banks, belong to public services. Domestic and foreign companies.

“The drop in deposits is due to the drop in government spending after 2014, especially since most of the deposits are in government banks,” banking expert Nihad Abboud told a news briefing. “The government’s austerity policy reflected a decline in private sector deposits from $ 20 billion to $ 18 billion in 2016,” he said.

Abboud warned of “concentrating government deposits and limiting their dealings with government banks, specifically Rafidain Bank, which accounts for 45 percent of total deposits, which carries great risks in the event of any emergency, in addition to the deliberate weakening of the private banking sector of Iraq.

A source at the Central Bank said in a press statement that «the decline in levels of deposits in banks caused by the crisis of falling oil prices and the cost of war on the urging and government expenditures on internal displacement».

He explained that «the bank has followed a wise policy through which to manage the financial policy without having any negative consequences, Iraq has gone through a very severe crisis was a sudden decline in the volume of government and private deposits, and liquidity is trading outside the banks, and here is difficult to control Or even directed to manage sufficient amounts of dinars to cover the large expenses ». “The size of these deposits will grow significantly this year as a result of the lifting of many items that were burdens on the state treasury, including war expenses of $ 30 million a day, and reduce unnecessary spending that can be exploited in economically viable projects.”

“The old cultures that are still practiced have played a prominent role in dealing with the banking sector,” said Mahasen Hamdoun, a member of the parliamentary finance committee. “The Iraqi citizen still prefers to keep his money in his home, whether gold or gold, Emergency, war or unexpected displacement. ”

“The other reason why bank deposit rates remain below the required level is that banks refrain from any advertising or educational activity,” she said.