Central Bank of Iraq


The Central Bank of Iraq is the central bank of Iraq.

History

After World War I, Iraq's monetary system was administered by the British Mandate of Mesopotamia until 1931, when the Iraq Currency Board was established in London to issue the new Iraqi dinar and maintain its reserves. The Iraq Currency Board pursued a "conservative monetary policy, maintaining very high reserves behind the dinar", which was "further strengthened by its link to the British pound".
In 1949, the currency board was replaced by the National Bank of Iraq, which had been founded two years before on November 16, 1947. The National Bank of Iraq became the Central Bank of Iraq in 1956. Since switching over to its own central bank, the Iraqi monetary system was "replete with mismanagement, coercive stop-gap measures, and the production of an unstable, unreliable currency which ha not been tradable on the international market for years". Saddam Hussein wielded monetary and the dinar as "a powerful instrument of repression".
In March 2003, on several occasions beginning on March 18, the day before United States forces entered Baghdad, nearly US$1 billion was stolen from the Central Bank of Iraq. This was considered the largest bank heist in history until 2011. That month, a handwritten note signed by Saddam Hussein surfaced, ordering $920 million to be withdrawn and given to his son Qusay Hussein. Bank officials state that Qusay and another unidentified man oversaw the cash, boxes of $100 bills secured with stamped seals known as security money, being loaded into trucks and trailers during a five-hour operation. Qusay Hussein was later killed by the U.S. military in a battle.
After the 2003 invasion of Iraq and Saddam Hussein's downfall, the Central Bank of Iraq was established as Iraq's independent central bank by the Central Bank of Iraq Law 2004, with authorised capital of 100 billion dinars. According to the law, 100% of the bank's capital stock would be held by the State and would not be transferable.
The Constitution of Iraq states that the central bank is a financially and administratively independent institution, responsible before the Council of Representatives of Iraq. According to the Constitution, the Federal government of Iraq has the "exclusive authority" of "establishing and administering a central bank".
On 25 January 2011, the Supreme Court of Iraq ruled that the Central Bank of Iraq should be under supervision of the Council of Ministers of Iraq. Then Central Bank chief Sinan Al Shabibi warned that the ruling would threaten the institution's requisite independence.
Currently the acting Governor of the Central Bank of Iraq is Abdel Basset Turki, which also happens to be the head of the state-spending watchdog the Board of Supreme Audit.
In June 2014, Islamic State of Iraq and the Levant militants looted the Central Bank in Mosul, absconding with over $429 million USD.

Governors

Governors of the Central Bank of Iraq since its establishment
The bank headquarters were designed by Danish architects Dissing+Weitling and was completed in 1985. It is a cubical building constructed of reinforced concrete clad in marble. It has few exterior openings, and is instead organised around an inner courtyard which cuts through the heart of the structure and rises to a height of 40m. The courtyard is surrounded on all sides by offices separated by an interior glass curtain wall.
, Baghdad
In August 2010, architect Zaha Hadid, born in Baghdad, was appointed to design a new headquarters for the Central Bank in Baghdad. Initial talks about the project were held in Istanbul, Turkey, on 14 August 2010, in the presence of the Central Bank Governor Sinan Al Shabibi. On 2 February 2012, Zaha Hadid joined Sinan Al Shabibi at a ceremony in London to sign the agreement between the Central Bank of Iraq and Zaha Hadid Architects for the design stages of the new CBI Headquarters building.

Objectives

As of at least 28 March 2011, the official web site of the CBI states "the primary objectives of the Central Bank of Iraq are to ensure domestic price stability and to foster a stable competitive market-based financial system. The CBI shall also promote sustainable growth, employment and prosperity in Iraq". The CBI web site further states that the functions of the CBI in addition to the primary objectives mentioned above include:
The objectives of the Central Bank of the Iraq are as follows:
As of December 2009, the bank reported total assets valued at over 57 trillion dinars. The bank’s head office is located in Baghdad with four branches in Basrah, Mosul, Sulaimaniyah, and Erbil. However, currently the bank does not control the financial and administrative affairs of Erbil and Sulaimaniyah branches, as these branches are technically reporting to the Baghdad headquarters and for all other issues they are reporting to Kurdistan Regional Government and they are financed by KRG.
As of July 2010, steps and measures have taken place in order to integrate these branches with the headquarters in Baghdad.
Foreign exchange reserves have increased to nearly US$67 billion due to a rise in oil revenues, indicating the improved ability since 2003 to deal with the repayment of foreign debt, the currency stabilization, and the coverage of average monthly imports.