Baghdad, Iraq, October 24, 2021— To support the growth of smaller businesses in Iraq and help them create jobs and overcome challenges, including from COVID-19-related disruptions, IFC today announced an investment for the National Bank of Iraq (NBI).
IFC’s $10 million loan to NBI will allow the bank to increase lending to small businesses in Iraq across a range of sectors. IFC will also provide NBI with advisory services support to help it reach more small and medium enterprise (SMEs) clients and better serve them.
A World Bank report found that about 60 percent of jobs in Iraq are in the private sector and that SMEs are responsible for most of them. Even so, smaller businesses in the country face numerous challenges, including lack of liquidity.
Speaking about IFC’s loan to NBI, Chairman of NBI Bassem Khalil Al-Salem said, “In Iraq, SMEs play a critical role in the national economy, and with the funds from IFC’s loan, the National Bank of Iraq will be able to continue its consistent support of this vital sector through increased financing and working capital, which will, in turn, propel business activity, preserve jobs and ensure further economic stability.”
“Supporting small and medium enterprises is vital to diversifying Iraq’s economy, creating jobs, spurring sustainable economic growth and shared prosperity, especially in wake of the COVID-19 pandemic, which had a heavy impact on the SMEs revenues and operations in Iraq” said Abdullah Jefri, IFC’s country manager for the Levant region.
The loan announced today includes support of up to $1 million from the Global SME Finance Facility (GSMEF), a blended finance partnership funded by the United Kingdom and the Netherlands. This new loan follows a loan of $10 million IFC extended to NBI in 2020, also made in support of SMEs in Iraq.
IFC has committed $970 million to support Iraq’s private sector since 2005, with its current committed portfolio standing at about $121 million in sectors including energy, telecom, and banking.
IFC—a member of the World Bank Group—is the largest global development institution focused on the private sector in emerging markets. We work in more than 100 countries, using our capital, expertise, and influence to create markets and opportunities in developing countries. In fiscal year 2021, IFC committed a record $31.5 billion to private companies and financial institutions in developing countries, leveraging the power of the private sector to end extreme poverty and boost shared prosperity as economies grapple with the impacts of the COVID-19 pandemic. For more information, visit www.ifc.org.
National Bank of Iraq, owned by Jordan's Capital Bank Group since 2005, provides a comprehensive range of innovative banking services to corporates and individuals in Iraq.
With its extensive network of correspondent banks, Capital Bank stands as National Bank of Iraq’s gateway to global economies, as it facilitates sending and receiving internal and external transfers, granting credit facilities, and providing trade finance services. National Bank of Iraq can trade on behalf of its clients in the Jordanian market and in global markets through Capital Investments, Capital Bank’s investment arm- as well as providing trading services in the Iraq Stock Exchange through its wholly owned subsidiary.
The acquisition that Capital Bank Group undertook towards the end of 2020 of the Lebanese Bank Audi business in Jordan and Iraq reinforced the group’s expansion and presence in these two markets, as the branches of the National Bank of Iraq increased from 13 to 18 branches in all major cities.