Al Furat News reveals details of the restructuring plan for Rafidain and Rashid Banks
Al Furat News reveals details of the restructuring plan for Rafidain and Rashid Banks
2025/01/10
An economic expert revealed the government’s plan to restructure its two banks, Rafidain and Rashid.
Salah Nouri told Al Furat News Agency, “The reasons for restructuring Rafidain and Rashid banks are the presence of bad financial assets, most of which are loans granted that were impossible to obtain before 2003, which led to a decline in the credit rating by international financial institutions and the refusal to deal with them.”
He explained that “in order to restore international confidence in the two banks, it is necessary to restructure the two banks by excluding bad financial assets from the financial center of the two banks and using modern technology and establishing two parallel banks, one for Rafidain and the other for Rashid, to which the bad financial assets will be transferred.”
He explained, “After separating Rafidain Bank into a bank that owns sound financial assets and another parallel Rafidain Bank that owns bad financial assets, as well as Rashid Bank into Rashid Bank that owns sound financial assets and Rashid Bank that owns bad financial assets, Rafidain and Rashid banks, which own sound financial assets, will be merged into one bank, as well as merging Rafidain Bank with bad financial assets with Rashid Bank with bad financial assets into one bank.”
Nouri said that “the new bank after the merger with sound financial assets will practice cash and contractual credit activities and dealings with international financial institutions, but the new bank after the merger with sound financial assets needs capital support with not small amounts, and this must be determined by the party that supports the capital, according to the government decision.”
He noted that “among the financial activities of the new bank is the use of artificial intelligence in addition to bank employees with high technical skills.”
He continued that “the process of restructuring the two banks financially and organizationally since 2011 with the membership of the Federal Board of Financial Supervision, the Central Bank of Iraq, the international auditing firm EY, the Ministry of Finance and the two banks concerned, has stopped, and currently the process of restructuring the financial and organizational structure has been resumed by assigning the international auditing firm according to the methodology referred to above.” Prime Minister
Mohammed Shia al-Sudani chaired a special meeting yesterday, Thursday, to discuss the development of the work of government banks, in the presence of representatives of Ernst & Young for Auditing and Financial Consulting.
The Prime Minister explained that “the completion rate of the project to restructure Rafidain Bank has reached its final stages, stressing that it will enter into force in the coming few days, within the framework of a plan that has been studied and implemented according to the established standards and specifications.”
Meanwhile, the Prime Minister’s financial advisor, Mazhar Mohammed Salih, revealed to {Al Furat News} that a new banking entity is about to be born in Iraq.
Salih said that “the study aims to establish a new banking entity specializing in government banking operations, to meet the needs of the government exclusively. This entity will contribute to achieving the goals of the unified treasury account, which is a crucial tool for regulating cash flows for public finances.”
He pointed out that “the study focuses on evaluating the legal status of the two banks, including property rights, evaluating assets and liabilities, and studying the requirements of a strategic partner if necessary, with a focus on developing the two entities to operate according to advanced financial technology that meets the requirements of the national banking market.”
He stressed that “the structural reform also aims to enhance the integration of the two banks into the national banking market and enable them to expand into global financial markets, especially in the areas of trade and investment financing for the private sector,” indicating that “the two potential entities will rely on modern systems in compliance, governance and risk management, with a focus on digital payments.”
alforatnews.iq
