Shafaq News- Baghdad

Most depositors’ funds at Al-Taif Islamic Bank are guaranteed, and the Central Bank of Iraq (CBI) will intervene if the lender faces a shortfall, Governor Nizar Nasser Hussein said on Sunday.

Speaking with a group of economic specialists, Hussein said the CBI has reserves, financial tools and contingency plans to manage crises, adding that it has strengthened internal oversight and taken preventive measures toward financial and banking institutions.

The CBI is continuing its banking sector reform program in coordination with consulting firm Oliver Wyman. Hussein said the next phase would bring further changes aimed at strengthening the sector and integrating it more closely with the international financial system.

He added that international confidence in the CBI was “very high.”

On Iraq’s money supply, Hussein said the CBI has issued about 107 trillion dinars (about $81.7 billion) in currency, while roughly 40 trillion dinars (about $30.5 billion) is circulating in the market.

He also said changing the currency falls within the CBI’s authority, while removing zeros would require legislation from parliament.

The CBI plans to launch new lending initiatives for key projects to stimulate investment and production and expand the private sector’s role in the Iraqi economy, Hussein said.

He described banking reform as an ongoing process aimed at building a more efficient and competitive sector, adding that the government’s economic approach places greater emphasis on the private sector’s role in development.

Al-Taif Islamic Bank was placed under CBI guardianship on Sept. 2 over violations that the Central Bank said had affected its financial position and depositors’ funds.

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