The Trade Bank of Iraq (TBI) has doubled the maximum value of individual letters of credit (L/Cs) it allocates to the country's private banking sector.

The bank says it has raised the maximum L/C value from US$2 million to US$4 million to meet an increasing demand for cross-border trade finance.

Increased business

The higher value L/Cs allow 18 private banks to immediately increase the size and range of the business activities they finance for their clients.

The number of Iraqi banks able to write new L/C business is also expected to increase.

L/C values

Last year TBI allocated 945 L/Cs valued at around US$500 million to private banks.

This brought the total number of L/Cs allocated to private banks by TBI since it was founded in 2003 to 2,446 at a value of about US$3 billion.

Training support

According to TBI's chairman, Hussein Al-Uzri, the bank is not only allocating more L/Cs, it is also providing training to enable local banks to develop in-house abilities to arrange cross-border business.

TBI is also helping local banks develop their own working relationships with a growing number of international correspondent banks.

This article represents the views of the author and not necessarily those of the ICC or any of the other partners in DC-PRO.