Central Bank of Iraq launches private banking reform programme with mandatory standards and Q1 2026 compliance assessments

The Central Bank of Iraq has unveiled a government-backed reform programme for the Iraqi private banking sector, developed in cooperation with Oliver Ayman Consulting, to modernise the sector and strengthen financial inclusion, efficiency and resilience. The plan sets out mandatory banking standards and a multi-stage process to assess private banks’ compliance, with the first evaluation cycle expected to start in the first quarter of 2026. The programme targets broader financial inclusion through strengthened legal and regulatory frameworks, modernised payment systems to enable efficient and reliable transactions, and expanded financial infrastructure including more branches and ATMs. It also links sector modernisation to enhanced depositor and creditor protection, financial education campaigns, and simplified anti-money laundering and counter-terrorist financing compliance, including evaluation through a digital identity system. Required standards are grouped into four areas covering ownership and governance structure, sustainable business models, financial metrics such as capital adequacy and liquidity ratios aligned with international best practices, and risk and regulatory compliance including stronger audit and reporting transparency and controls on related-party conflicts. Over the coming months, detailed standards and implementation timetables are due to be issued via official circulars, alongside support channels, workshops and technical assistance to prepare banks ahead of the assessment process.