The Trade Bank of Iraq is playing a key role in Iraq's reconstruction and is one of the financial sector's most likely candidates for privatisation in the future, a prospect that is exciting investors both at home and abroad. Established in 2003 to service the government and public sector clients, it is now helping to expand the private sector and advising on the restructuring of Iraq's commercial debts. In this wide-ranging, exclusive interview with Pamela Ann Smith, TBI's Chairman, President and CEO, Hussein Al Uzri, underlines the importance of foreign investment in Iraq and outlines TBI's plans to help further develop the Iraqi economy.
Significantly, TBI is in the unique position of having agreements to issue Letters of Credit (LCs) with an international consortium of the world's leading financial institutions, including JPMorgan Chase, Calyon, Standard Chartered, The Bank of Tokyo-Mitsubishi, Australia and New Zealand Banking Group, HypoVereinsbank, Sanpaolo IMI and the National Bank of Kuwait, as well as other agreements with government export credit agencies in 20 countries.
So far it has issued trade finance commitments worth some $35bn, and has established representative offices in 37 countries.
You are a state bank, yet you have an independent board of directors. Why? And does this help you?
Trade Bank of Iraq is an independent state-owned bank created by a special law which guarantees its independence and its board of directors is the highest management authority in TBI. This gives it the advantage of making effective decisions in an efficient time frame.
Your work with the private sector is expanding rapidly, particularly in corporate and trade finance. What trends do you see in this for TBI?
In 2006, the government stated its policy for revitalising the private sector in Iraq as it firmly believed that this was a critical component of a sustainable and healthy Iraqi economy. In line with this policy, TBI has been offering a broader range of products and services to the private sector, with letters of credit issued growing by approximately 47% to $1.3bn in 2008. More importantly, TBI has been supporting the private sector banks by sharing its trade finance business, allocating to them for issuance $445m worth of letters of credit in 2008.
What are your relationships with international export credit agencies?
TBI, along with the Ministry of Finance, has signed agreements with 20 agencies in different...