By Mark DeWeaver. In my last post I argued that Iraqi banks’ high cash/deposit ratios are due to the absence of an interbank market. If that is the case, you might think it would be easy to get the banks to put more of their deposits to work in the "real economy." Couldn’t somebody (e.g. […]
Tag Archives | interbank markets
Are Iraqi Banks Too Liquid?
By Mark DeWeaver. Fund managers visiting Iraq for the first time are often surprised by the large amounts of cash Iraqi banks typically hold. While the Central Bank of Iraq (CBI) requires lenders to hold 15% of their deposits in the form of vault cash and central bank reserves, most hold well over 50%. (See […]