CBI Cracks Down on Financial Firms Lacking Licenses

Strengthening Financial Regulations in Iraq

The Central Bank of Iraq (CBI) has issued new guidelines requiring all financial institutions to obtain licenses and permits before operating, aimed at strengthening financial regulations in the country.

New Licensing Requirements

The CBI will only issue licenses and permits to companies established in Iraq with juridical persons and registered under Iraqi law. Foreign banks seeking to establish branches or representative offices in Iraq must also obtain a permit from the CBI.

• Companies must have a clear capital structure, ownership, and management team.
• The regulator plans to conduct regular audits of licensed institutions to ensure compliance with its regulations.

Stricter Requirements for Foreign-Owned Banks

The new regulations impose stricter requirements on foreign-owned banks, limiting the number of such institutions to six by December 31, 2008. After that date, there will be no limit on the number of foreign-owned banks operating in Iraq.

• The CBI aims to prevent financial instability and protect consumers by ensuring all financial institutions operate in accordance with international standards.
• Foreign-owned banks must also implement adequate measures to prevent money laundering and terrorist financing.

Commitment to Combating Money Laundering and Terrorist Financing

The CBI has emphasized its commitment to combating money laundering and terrorist financing, requiring all licensed institutions to implement adequate measures to prevent these activities.

• The regulator aims to maintain the stability of Iraq’s financial system by ensuring robust regulatory oversight.
• The new guidelines are seen as a major step towards strengthening Iraq’s financial sector, which has faced challenges in recent years due to the country’s complex political landscape and economic instability.