Iraq Launches New Bank to Meet International Standards
The First Rafidain Bank Will Be Established with a Capital of One Trillion Iraqi Dinars to Enhance National Banking Capabilities.

Jan 14, 2025
ERBIL (Kurdistan24) – In a strategic move to modernize its financial infrastructure, the Iraqi Council of Ministers has announced on Tuesday the establishment of the First Rafidain Bank, endowed with a capital of one trillion Iraqi dinars and designed to meet international standards.
This initiative marks a significant step in Iraq's ongoing efforts to bolster its economic framework. The Council detailed that the new bank would be open to investment from the government, private sector companies, and individual shareholders.
This contrasts with the existing Rafidain Bank, which is fully government-owned and whose capital falls short of international benchmarks. Despite prolonged efforts to enhance the capabilities of the existing Rafidain Bank, it has struggled to meet the requirements needed to function as a standard international bank. This challenge has led to the decision to establish a more compliant and capable financial institution.
The Iraqi Prime Minister Mohammed Shia Al-Sudani has directed the Central Bank of Iraq (CBI) to collaborate with international partners in establishing the First Rafidain Bank. This development is part of a broader strategy to upgrade Iraq’s banking system, which has historically presented substantial obstacles to the country’s economic growth.
The establishment of the First Rafidain Bank is expected to provide a robust platform for Iraq's financial sector, encouraging greater economic stability and international investment.
The lack of a standardized banking system in Iraq has posed significant challenges for the development of the country's economy and financial sector. A major issue stems from the banking sector's limited ability to provide comprehensive services and engage in modern financial activities, such as credit provision, international transactions, and electronic banking. This inadequacy hampers investment, both domestic and international, as potential investors face hurdles in managing financial transactions efficiently within Iraq.
Moreover, the absence of a robust banking infrastructure has contributed to a heavy reliance on cash transactions across the country, leading to issues with liquidity management, transparency, and security.
This situation also complicates the government's ability to implement effective fiscal policies and hinders efforts to combat corruption and money laundering. As a result, the economic growth of Iraq is stifled, keeping it from fully integrating into the global financial system and benefiting from economic globalization.
The establishment of a more standardized and modern banking system is crucial for Iraq to attract investments, improve economic stability, and foster long-term development.