Iraqi Dinar – Dinar
Iraqi Local Banks to the Rescue
Lending may not be totally a no go area as far as the Iraqi economy is concerned. It is true that the foreign banks are not so willing to let go of their money by lending it out to individuals who would love to set up one form of business or the other. But the local banks that are operating in the Iraqi nation seem to be bent on wiping off the tears of these private business owners and they seem to be nor responsive top their needs that n their foreign counterparts. It is also hoped that the foreign banks will have a change of heart and be more responsive to lend out.
The foreign banks may however have their reason for taking this kind of action as far as their lending is concerned. It may be because they are not so sure of what the economic terrain of Iraq is holding and they wouldn’t like to incur a high degree of bad debts at the end of the day. This is why one may not be doing the right thing by shifting all the blames on these banks owned by foreign businesses in Iraq. It is therefore better to watch things very carefully before passing comments.
Be that as it may, the banks that are owned by local individuals in Iraq are more responsive to the borrowing needs of individuals who are interested in setting up some private businesses in Iraq. These indigenous banks seem to be more interested in making money available to these business owners to enable them set up something in terms of private businesses. The case can be proved by the high lending to deposit ratio of these locally owned banks. In comparison to banks owned by foreign investors in Iraq, the ratio is very high since the foreign banks are not lending out much of their money.
With this kind of situation, one can say that the locally owned banks are the ones that are rescuing business owners in Iraq. If not for them, it could have become a rather impossible thing for these local business owners to set up their private business and thereby help in improving the present not too great state of the Iraqi financial system. One can say that these locally owned banks are ore confident about how things turn out concerning the money they are lending out to business owners.
This may probably be due to the fact that they are from the country themselves and they know how things are going. The fact that the banks are set up by Iraqis can be said to be the contributory factors that makes it possible for them to be so confident in their borrowers. It is also possible that they have more interest in developing the Iraqi economy compared with foreign banks that are operating in Iraq. One can only appeal to these foreign banks in Iraq to come out of their shells and help contribute to the development of the Iraqi financial system by increasing their lending.
