Fears of private banks deterioration, banking expert
BAGHDAD/ Aswat al-Iraq: Banking expert Sameer al-Nusairi expressed his fears that the private banks positions will be deteriorating in response to increase their capitals to 250 billion dinars within the coming three years.
He told Aswat al-Iraq that there are fears within the investors sectors in Iraq Stock Market that "negative reflection will occur on their stocks shares that will reach less than their nominal prices".
Central Bank of Iraq put a 3-stage plan, starting in 2009, for the private banks to gradually increase their capital to reach 250 billion dinars.
Iraq has seven governmental banks, 23 private banks and 11 Islamic banks, with one Iraqi dinar per share.
According to Nusairi, "if no merge is occurred among the banks, the capital needed on 30 June, 2012 will reach to 4.8 trillion Iraqi dinars for the whole private banking sector, which means more shares should be submitted to the Iraqi financial market".
This situation led responsibles at the banking sector to suggest postponing the capital increase proposal till better financial conditions in the country.
Nusairi believes that the CBI and finance ministry will extend suitable assistance to the private banks to be able to increase their capitals to the desired figures.
He added that coordination should be made between the governmental banks and the private to finance big projects within the Development Plan in Iraq.
Nusairi proposed forming joint financing funds and have new thoughts on the taxes implicated for the past years.