Iraqi Central Bank Denies Bankruptcies

Al-Taj News – The Central Bank of Iraq confirmed that imposing supervisory committees or trusteeship on any licensed bank does not mean that it is bankrupt, but rather constitutes a precautionary supervisory measure aimed at ensuring the bank’s soundness, the stability of its operations, and the protection of depositors’ rights.

The Central Bank explained, in a statement, that these measures fall within its legal powers and its role in protecting the financial system and ensuring the soundness of the banking sector, stressing the application of international banking standards to ensure banks’ compliance and the continued provision of financial services without compromising customers’ rights.

The bank noted that all licensed banks participate in the Deposit Guarantee Company, which compensates depositors if any bank defaults on meeting its obligations, in accordance with the laws in force.

It stressed that depositors’ funds are protected under laws, regulations, and instructions, and that it monitors banks’ procedures to ensure customers’ ability to access their funds without delay.

The Central Bank affirmed that the Iraqi banking system has sufficient levels of liquidity enabling it to manage its operations efficiently and withstand potential pressures.

According to the statement, the ratio of liquid assets to short-term liabilities exceeds 60%, reflecting the amount of liquidity available to banks compared with their short-term obligations.

The latest data from the Central Bank of Iraq indicate that the volume of currency in circulation outside banks reached about 101.97 trillion dinars (approximately $77.8 billion), equivalent to 91.7% of the total currency issued.