Joint Statement by the Office of the Prime Minister and CBI

Banking reforms constitute an important pillar of the economic restructuring adopted in the government program, and in order to complete the important steps that the government has embarked on in this framework since it began its work, and for the purpose of achieving a package of development targets that require banking development, hence, the government, in cooperation with CBI, has embarked on a comprehensive initiative that includes a complete strategic banking reform process that constitutes a turning point in the history of economic development in Iraq, which is consistent with the commitment extent to raise the level of banking standards, enhancing financial flexibility, and supporting the competitiveness of the financial system.

These comprehensive reforms aim at keeping pace with developments in the countries of the region and the world, and contribute to open partnerships and horizons of communication with the outside world on a broad scale in modern banking and financial transactions, as CBI works to implement and develop regulatory and supervisory frameworks with international partners, which contributes to achieve sustainable growth and development of the banking sector, just as the government works to support the reforms and efforts of CBI in developing the situation of the banking sector. These reform efforts focused on the following main areas:

1. Strengthening ownership structures and governance frameworks, by enhancing transparency and accountability, through measures including; creating diverse ownership structures, and ensuring independent oversight by boards of directors over operations and committees.
2. Raising the level and standards of service, by increasing access to basic financial services for all Iraqis, through enhancing efficiency, increasing the supply of products, and modernizing the banking sector infrastructure.
3. Aligning and compatibility with international standards, by imposing adherence to recognized frameworks and practices in the areas of combating money laundering and countering the financing of terrorism, as well as adhering to financial transparency, in order to ensure smooth banking services and support businesses and citizens’ needs.
4. Enhancing financial flexibility, by boosting the financial soundness of Iraqi banks and setting strong requirements for the capital and cash liquidity, to protect customer deposits and economy, to face the local and international challenges.

This initiative comes within the framework of a broader strategy aimed at modernizing the banking sector, which CBI is currently developing in partnership with Oliver Wyman, a leading global management consulting firm. The ongoing reforms that implemented with government banks, enhance the integration of this strategy, which represents a turning point in the future of the Iraqi financial system.

The implementation details of these reforms will be provided later.

From this standpoint, the government and CBI emphasize the adoption of a joint reformatory vision, which is represented by establishing a modern, transparent and comprehensive banking system that supports the aspirations of the dynamic economy of Iraq.