New Dinars for Old
At the end of last month, a spokesman for the Central Bank of Iraq (CBI) told reporters that a plan to redenominate the Iraqi dinar will be presented to the Council of Ministers in the near future. (See here and here.) The Council is then expected to submit the relevant legislation to Parliament for a vote. If the lawmakers approve the project, all existing banknotes will be replaced with new currency at the rate of 1,000 old dinar for one new over some unspecified period of time.
Given Parliament’s current backlog, this change can hardly be imminent. Still, you might think they could get around to voting on the CBI’s proposal some time before the end of this year. In that case, the redenomination could presumably be completed by the end of 2012.
The process will necessarily involve both the exchange of new banknotes for old and the restatement of contractual obligations in terms of the new currency. Among other things, three zeros will have to be eliminated from the share capital of the ISX listed companies as well as from the number of shares each has outstanding. (This will keep the par value at one dinar.)
I’m told this should be a relatively straightforward change for the depository center to make. Trading should not have to be suspended for more than a few days and it may be possible to proceed in phases of a few names at a time so that the entire market does not have to shut down during the transition period.
Similarly, it seems reasonable to expect the CBI to exchange new dinars for US dollars at one thousandth the rate for old dinars. In other words, if the original rate were IQD 1170 = US$ 1, post-redenomination this would become IQD 1.170 = US$ 1.
All of this seems reasonably straightforward for anyone holding assets such as currency or shares inside the country. For those holding dinar cash outside Iraq, however, things may not be so simple. How and on what terms their old dinars will be convertible into the new currency remains an open question.
http://www.iraq-businessnews.com/201...inars-for-old/
Please visit our sponsors
Results 1 to 3 of 3
Thread: New Dinars for Old
-
05-07-2011, 10:30 PM #1
- Join Date
- Oct 2006
- Posts
- 16,540
- Feedback Score
- 0
- Thanks
- 2,036
- Thanked 16,455 Times in 10,096 Posts
New Dinars for Old
-
-
Sponsored Links
-
09-07-2011, 02:09 AM #2
- Join Date
- Oct 2005
- Posts
- 976
- Feedback Score
- 0
- Thanks
- 2,126
- Thanked 398 Times in 184 Posts
-
09-07-2011, 02:53 AM #3
- Join Date
- Dec 2010
- Posts
- 25
- Feedback Score
- 0
- Thanks
- 206
- Thanked 39 Times in 23 Posts
I am ready to travel to Kurdistan in a moment notice..hazards of currency speculation.
-
The Following User Says Thank You to PeterJ For This Useful Post:
-
Sponsored Links
Thread Information
Users Browsing this Thread
There are currently 1 users browsing this thread. (0 members and 1 guests)
24 Hour Gold
Advertising
- Over 20.000 UNIQUE Daily!
- Get Maximum Exposure For Your Site!
- Get QUALITY Converting Traffic!
- Advertise Here Today!
Out Of Billions Of Website's Online.
Members Are Online From.
- Get Maximum Exposure For Your Site!
- Get QUALITY Converting Traffic!
- Advertise Here Today!
Out Of Billions Of Website's Online.
Members Are Online From.