Iraq

#Dana Gas #venture #seeks #$26.5b damages from #Iraq Kurds

Dana Gas and its partners are looking at recovery for damages of at least $26.5 billion from Iraq’s self-governing Kurdish region for all delays in oil and natural gas projects. Dana Gas is based in the UAE and its partners in the venture named Pearl Petroleum, filed a petition in May at a federal court in Washington, DC, seeking “recognition and enforcement” of awards in a London arbitration case. The petition is part of a legal process that may allow Pearl Petroleum to seize Kurdish assets if the Kurds don’t pay awards decided in arbitration.
According to the Kurdish Energie Minister stated, the Kurdistan Regional Government “considers that the claimants’ approach in the arbitration is unconstructive and unnecessarily escalates the dispute. It will continue vigorously to pursue its rights and defend its position in all appropriate forums.”
Dana Gas and partners are pursuing claims in the London Court of International Arbitration against the Kurdish Regional Government for damages related to delays they say were caused by the Government in developing the projects.

#Noor #Al-Iraq #Islamic #Bank goes #live #on #ICS #BANKS® #ISLAMIC from ICS Financial Systems

ICS Financial Systems Limited (ICSFS), the global software and services provider for banks and financial institutions, today announced a successful implementation of its awards winning software; ICS BANKS® ISLAMIC System, in Noor Al-Iraq Islamic Bank, an Iraqi based bank which was formerly known as Sama Baghdad Islamic Bank.
Noor Al-Iraq Islamic Bank has officially announced the successful go-live of ICS BANKS ISLAMIC System, in its Head Quarter and branches all over Iraq. The bank experienced a smooth implementation with a record breaking time of two months, where it adopted ICS BANKS ISLAMIC Core Banking, Credit Facilities & Risk Groups, Remittances, Murabaha, Musharaka, Istisna’a, Investment Accounts & Profit Distribution, Time Deposit, Trade Finance and part of ICS BANKS Delivery Channels (DC); ICS BANKS Internet Banking.

#Iraq Islamic banks see opportunity for expansion

Despite all the instability and continued sectarian violence in parts of Iraq, the country’s few Shariah-compliant lenders see chances to expand their business. As a result of the ongoing internal conflicts since the toppling of the regime in 2003 by the US, Iraq has been widely reduced back to a cash economy. Cash payments keep dominating the economic system because the majority of the population does not have a bank account. According to World Bank data, just about 11% of Iraqis use the services of formal banking institutions. However, Islamic banks reckon that the majority of the Iraqi population does not use banking services because most of them fail to comply with the provisions of Islamic law. Islamic banks currently account for 1.5% of total assets of Iraqi banks, amounting to nearly 3tn dinars ($2.55bn), this could grow to nearly 6% in the coming years if the political and economic environment improves and the necessary legislation gets introduced.

Inside #lraq’s Cash Economy: Fully Reserved #Banking in a Monetary Dystopia

In Iraq the private sector is primarily cash-based. Bank financing is unavailable for all but the largest companies and even then is limited mainly to overdraft facilities. Private banks are subject to large and unpredictable demands for cash from depositors, while money transfer companies do not take deposits at all. The majority of households do not have a bank account, those with savings often hold them in the form of US dollar hoards in private safes.

Towards a More Enabling Legal Framework for Microfinance in Iraq

In Iraq, authorities continue to battle ISIS while advancing important political reforms. And microfinance – in the broad sense of providing credit, savings, payments, and insurance to low-income households and small businesses – is one intervention poised to promote local economic activity and help manage economic shocks. The 2014 Findex survey found that only 11% of the adult population has an account at a formal financial institution. It also revealed a significant gap between Iraqi citizens who borrowed formally (4%) and those who did so informally (65%), hinting for a much higher demand than that currently served by the financial sector. This is notably because Iraq’s financial system remains seriously underdeveloped, as highlighted in the World Bank’s 2011 Financial Sector Review.

Iraq to seek up to $500 million in loans from Islamic Development Bank

Iraq will seek up to $500 million in loans from the Jeddah-based Islamic Development Bank (IDB) to help cover its projected deficit, complementing the country's return to the international debt market, according to the bond's prospectus. Baghdad wants to raise up to $6 billion in a series of dollar-denominated bonds, Iraq's first in nine years, to fund salaries as well as infrastructure projects in the oil and gas, electricity and transportation sectors.

MEPS partners with Cihan Bank for Islamic investment and finance in Iraq

Middle East Payment Services (MEPS) - a consortium of local and regional banks that serves as a payment services provider in the Middle East - has signed a partnership agreement with Cihan Bank for Islamic Investment and Finance. This step corresponds with the Bank’s goals to expand the range of banking products and services it offers in Iraq by adding new services in the electronic payment field. By virtue of the agreement, MEPS will provide various services comprising call centers and operating MasterCard point-of-sale (POS) devices. In addition, MEPS will issue the Bank’s payment cards at all its branches across Iraq, as Cihan Bank strives to provide all types of MasterCard including debit, credit and prepaid cards.

Shari’ah banking seeks path through Iraqi strife

For all the sectarian violence gripping Iraq, Shari’ah-compliant banks operating in the nation see opportunities for growth. Elaf Islamic Bank, the 14-year-old Baghdad-based lender, is targeting 28 per cent increase in profit this year, even as rival Cihan Bank said its income dropped last year as militants seized vast swathes of the country. However, Cihan Bank also said its outlook improved toward the end of last year as the US began airstrikes on Islamic State. Meanwhile, Iraq’s cabinet approved a draft law yesterday regulating the Shari’ah-compliant banking industry, which will now move to the country’s parliament for passage.

PM urges Turkish investors to invest in Iraq’s economy

Turkish Prime Minister Ahmet Davutoglu urged the country's investors to invest in the economy of Iraq. Davutoglu made this statement at a session of the ruling Justice and Development Party. He said that Turkey must have firms and companies that operate in Iraq. Turkish investments in the territory of Kurdish autonomy of Iraq are estimated at $ 700 million. At present, around 1,500 Turkish companies, as well as the branches of such banks as Ziraat Bankasi, Vakifbank, Is Bankasi, Bank Asya and Albaraka operate in the territory of Kurdish autonomy of Iraq.

ADIB among banks planning Iraq expansion amid oil boom

Abu Dhabi Islamic Bank (ADIB) is the latest lender after JPMorgan, Citi and Standard Chartered to expand business in Iraq as the oil-rich country boosts crude production and rebuilds its infrastructure. ADIB plans to open a branch in Basra before the end of the year after it opened a branch in Erbil in October. The lender’s expansion in Iraq is part of a larger strategy to grow its international network, which includes branches in the United Kingdom, Egypt, Qatar, Saudi Arabia and Sudan. Iraq’s economy is expected to grow by 6.3 per cent this year, up from 3.7 per cent growth last year. The country raised its crude oil production by 530,000 barrels per day (bpd) last month to 3.6 million bpd. However, Iraq remains a fragile state and security risks can never be understated.

Yale Grad Trusts in Bank of Baghdad to Help Deliver Returns

According to Grant Felgenhauer, a portfolio manager at Euphrates Iraq Fund, the opportunities offered by Iraqi equities overshadow anything else in the world today. Felgenhauer returned 28 percent last year with bets on Iraqi shares such as Bank of Baghdad, compared with a 9.5 percent decline for Iraq’s ISX General Index. That helped make New York-based Euphrates the fourth-best performing emerging-market fund managing more than $50 million in 2013. Iraq is drawing investors from specialized hedge funds to global banks including Citigroup and Standard Chartered as the oil-rich nation rebuilds 11 years after the U.S.-led invasion. The economy will expand 6.3 percent this year and crude production is estimated to rise to 9 million barrels a day by 2020.

Iraq Gearing up for Major Investment Opportunities

Iraq is seeing a surge in investment activity. The nation begins to rebuild its domestic infrastructure and boost crude oil production. By the end of 2013, Iraq should see 3.5 million barrels of crude per day. Over this year, Iraq’s government is set to increase spending by 18 percent, reaching $118 billion. And the IMF has already projected that Iraq should see a yearly economic growth rate of around 9 percent. Banking in Iraq has come a long way, too, although basic banking infrastructure—ATMs, bank branches—are still lacking across the nation. However, spates of violence and an endemic culture of corruption are likely to cause some problems along the way. The Iraqi dinar is expected to experience a major improvement in terms of value, but it is important to remember that the development will take a while.

The Curious Case of Elaf Islamic Bank and the Part 561 List

The Office of Foreign Assets Control (“OFAC”) recently announced that it removed Iraq’s Elaf Islamic Bank from its Part 561 List. According to a 2012 New York Times article, Elaf had been named to the list because it had facilitated transactions worth millions of dollars with sanctioned Iranian banks and has objected to the Central Bank of Iraq’s allowing Elaf to continue to attend its U.S. dollar currency auctions. OFAC now says that Elaf has offered its mea culpa, frozen the accounts it holds for the Export Development Bank of Iran (“EDBI”) and begun reducing its overall exposure to the Iranian financial sector. The Elaf development appears to be a victory on paper as a non-U.S. person agreed to terms with the U.S. government over its dealings with Iran apparently occurring exclusively outside the United States. One can only wonder about how the United States will monitor Elaf’s frozen accounts or any of its future dealings with Iranian banks.

The Department of the Treasury Lifts Sanctions Against Iraq-based Financial Institution

The Department of the Treasury has lifted sanctions against the Elaf Islamic Bank in Iraq following the bank’s significant and demonstrated change in behavior. On July 31, 2012 the Treasury Department imposed sanctions under the Comprehensive Iran Sanctions, Accountability, and Divestment Act of 2010 (CISADA), against Elaf Islamic Bank for knowingly facilitating significant transactions and providing significant financial services for the U.S. and EU-designated Export Development Bank of Iran (EDBI). Following the CISADA finding, Elaf immediately began an intensive course of action to stop the conduct that led to the CISADA sanction. Now, U.S. financial institutions are once again permitted to open or maintain correspondent accounts or payable-through accounts in the United States for Elaf Islamic Bank.

Sharia lenders team up to fund Iraq's promising food sector

Iraqi Islamic Bank for Investment and Development has teamed up with a Bahrain-based Baraka Islamic Bank to develop an investment vehicle that will target Iraq's lucrative and promising food sector. The fund has already acquired interest from Arabian Gulf and European investors, prompting the Iraqi lender to increase the size of the vehicle from US$50 million (Dh183.6m) to $75m. It will provide financial support to an affiliate company of Iraqi Islamic Bank that has a three-year track record of delivering contracts on sugar stockpile to Iraq's ministry of trade.

Kuveyt Turk to raise capital, open Iraq, Qatar branches

The Turkish unit of the Kuwait Finance House, Kuveyt Turk, will raise its capital by TL 960 million in the next three months and another TL 360 million will be added over the following 15 months, according to its General Manager Ufuk Uyan. Moreover, the bank is planning to issue a sukuk worth TL 100 million ($55.40 million) in September or October. Besides, Kuveyt Turk expects to open a new overseas branch in Qatar and Iraq.

Iraqi Islamic Bank completes capital increase

Iraqi Islamic Bank (IIB) has completed the required capital increase set by the Central Bank of Iraq to a fully paid IQD 152 billion ($130 million). In line with its expansion policy, the Iraqi Islamic Bank will be opening its new north branch in northern of Iraq Erbil in April, taking the branch network to a total of 17. IIB was the first private Islamic Bank in Iraq, opening its doors in 1992.

Questions About Practices Of Private Iraqi Banks

Private banks in Iraq have almost utterly ceased to fulfill their traditional functions, e.g. giving out loans, lending credit and issuing letters of credit. The reason is the risk of default. That is why Iraqi private banks resort to participation in the currency auction regularly held by the Iraqi Central Bank instead. In order not to face defaults on payments, they demand exaggerated guarantees for the granting of any loans to local investors. Banking experts say that the value of some loans is not able to cover more than 40% of the guarantees which are demanded by the banks.

Iraq's Islamic Bank and the Islamicity of Interest

Recently, the president of Iraq - Jalal Talibani - gave his apprval to the new law establishing a state-owned Islamic bank. The name of the bank is "The Islamic Bank of Mesopotamia." According to the law, the bank starts with an initial working capital of 50 billion Iraqi dinars (about $43 million). Resources developed by the bank itself can later be used to raise that sum. The law further states that the purpose of the bank is to provide financial and banking services which are to be in accordance with Islamic shari'a and the development of the Iraqi economy. The law marks the first public effort of the country's government to enter into the rapidly developing and expanding field of Islamic finance.

Iraqi private banks struggle to cope with limited services, capital

Iraqi private banks are battle against decades of state dominance to win a slice of the asset base from government-run enterprises. It is no surprize than that they have it very hard raising their capital.
The poor credit culture, lack of a modern banking system, and the dominance of state banks aren't helping at all. That is why most business from this country is made with cash especially because they are worried about the security.

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