Banking & Finance Oliver Wyman joins EY in Iraq bank restructuring By Nadim Kawach February 21, 2025, 12:44 PM Alamy via Reuters London-based EY and America's Oliver Wyman will help to restructure Iraq's banks Iraq appoints EY and Oliver Wyman Two largest public banks may merge Others may go private Iraq has hired two of the world’s most prominent financial consulting firms to help restructure its banking sector, which has been wrecked by long-term violence, according to an adviser to the prime minister. London-based EY and Oliver Wyman of the US will prepare a roadmap for a plan that could include merging the country’s two largest public banks, according to Mudhar Saleh, an adviser to Iraq’s prime minister, Mohammed Al-Sudani. Iraq has seven major state banks and more than 50 national and foreign units, including 27 Islamic banks, according to a report last year by Bismayacity, a news website. “The government and the monetary authorities are working together for comprehensive reforms in the national banking system with the aim of bolstering its position,” Saleh told Iraq’s Al-Forat TV this week. He said the government has hired EY to carry out a “comprehensive evaluation” of state banks in pursuit of a “clear vision for the development of the banks and for their effective integration into the world financial system”. Saleh said Oliver Wyman has also been selected to conduct a comprehensive study as part of the restructuring plan. Last month, the Iraqi cabinet announced plans for restructuring public banks, including the creation of a giant new institution. The bank, to be called First Rafidain Bank, will have a paid-up capital of 500 billion Iraqi dinars ($382 million), to be raised later to one trillion dinars ($764 million). The government will control 24 percent, according to a cabinet statement cited by the Baghdad Today news website. The plan also includes transforming the government-owned Industrial Bank into a private joint stock company while seeking a strategic partner, the statement said. The cabinet decided to maintain the current status of other public banks such as the Agricultural Bank, the Real Estate Bank and the Housing Fund, according to the statement. Iraq bans five local banks from US dollar deals Iraq risks higher budget deficit after oil sales fall short Iraq must act fast to avoid a domestic energy crisis An independent Iraqi economist said last month the restructuring plan could include the merger of Rafidain and Rasheed banks, previously Iraq’s two dominant institutions. Salah Nouri, an analyst at the Baghdad-based Iraqi Institute for Economic Reform, said the main reason for restructuring the two banks is the accumulation of bad loans extended before the US-led 2003 invasion of Iraq. “I believe that the restructuring plan calls for the creation of two parallel banks, one for Rafidain and one for Rasheed, to which the bad assets will be transferred. Afterwards, there will be a merger of Rafidain and Rasheed with the healthy assets and of the two parallel banks with the bad assets,” Nouri said.
