US embassy cable - 04AMMAN1453

UNCLAS SECTION 01 OF 02 AMMAN 001453 
 
SIPDIS 
 
SENSITIVE 
 
TREASURY FOR QUARLES, ZARATE, MILLS, MCDONALD 
 
E.O. 12958: N/A 
TAGS: EFIN, PREL, PINR, JO, UNSC, IAZ 
SUBJECT: LETTERS FROM THE GOVERNMENT OF JORDAN 
 
 
1. The Embassy has received the following three letters 
regarding the Arab Bank from the GOJ. 
 
2. Letter from Governor and Chairman of the Board of the 
Central Bank of Jordan Umayya Toukan to Ambassador Gnehm: 
 
Your Excellency, 
 
I am writing to Your Excellency with regard to the interest 
of the Arab Bank to reopen its branches in Iraq.  As you 
might be aware, Your Excellency, the Arab Bank is the highest 
rated bank in Jordan in all aspects of its operations.  Its 
management is highly regarded in Jordan due to its good 
governance standards and integrity.  Furthermore, I had the 
opportunity to visit the OCC in New York who confirmed also 
that the Arab Bank in New York is highly regarded by the OCC. 
 
I am enclosing to Your Excellency copies of a letter by H.E. 
the Prime Minister sent to H.E. Ambassador Paul Bremer as 
well as a letter to Dr. Shabibi, the governor of the Central 
Bank in Iraq on this issue.  You might also recall that the 
issue was also raised during the visit of H.E. the 
Undersecretary of the Treasury for International Affairs Mr. 
John Taylor. 
 
I hope Your Excellency will use your good offices to support 
our request regarding the presence of Arab Bank in Iraq. 
 
Please accept, Your Excellency, the assurances of our highest 
consideration. 
 
Yours Sincerely, 
 
/S/ 
 
Umayya Toukan 
Governor and Chairman of the Board 
Amman, February 25, 2004 
 
3. Letter from Prime Minister Faisal El Fayez to 
Administrator Bremer: 
 
Dear Sir, 
 
I am taking the liberty of sending you a copy of a 
correspondence to Dr. Sinan Shabibi, Governor of the Central 
Bank of Iraq by the Central Bank of Jordan regarding Arab 
Bank's application to resume its business in Iraq. 
 
Allow me also to refer to your letter addressed to His 
Majesty King Abdullah II in which you requested His Majesty's 
help to facilitate a meeting between your people and the Arab 
Bank. 
 
As you may also be aware, the Arab Bank has responded 
positively to a direct approach by the CPA inviting it to 
consider re-establishing an operating presence in Iraq, and 
the Bank subsequently submitted an application for a banking 
license in accordance with the terms of the RFA dated 5 
November 2003. 
 
I am sure, Your Excellency, that you will appreciate our 
disappointment in learning that the Arab Bank was not among 
the institutions selected to proceed in the licensing 
process, despite what I believe to be a complete business 
case submitted by the Bank.  It is my understanding, however, 
that additional bank licenses may be issued shortly, and I am 
therefore writing to you now in the hope that you may want to 
look into the matter in order to give Arab Bank application's 
favourable consideration. 
 
Please be assured that I would not have taken this initiative 
had I not been entirely convinced of Arab Bank's ability and 
commitment to contribution to the development of Iraq's 
economy, which of course is ultimately also in the interest 
of the Jordanian economy. 
 
Kind regards, 
 
/s/ 
 
Faisal El Fayez 
 
Attachment: Letter to Dr. Sinan Shabibi 
 
4. Letter from Governor and Chairman of the Board of the 
Central Bank of Jordan Umayya Toukan to Central Bank of Iraq 
Governor Shabibi: 
 
February 8, 2004 
 
Your Excellency, 
I am writing to you with reference to the licensing of 
non-Iraqi banks in Iraq.  Arab Bank, a distinguished 
Jordanian bank, which has strongly established itself 
regionally and internationally, has expressed interest to 
re-open its branches in Iraq.  The Central Bank of Jordan, as 
the regulatory authority for banks in Jordan, would like to 
strongly support Arab Bank in this interest to re-open in 
Iraq.  Arab Bank is highly rated by established rating 
institutions, and I myself had the opportunity to visit the 
OCC in New York, who also confirmed that Arab Bank in New 
York is highly regarded by them.  We regularly inspect the 
financial statements of Arab Bank on a consolidated basis and 
it is granted the top rating in all the aspects of the CAMEL 
rating system.  Its management is respected in Jordan due to 
its good governance standards and integrity. 
 
More significantly, Arab Bank enjoys a well-deserved 
reputation for successful banking operations and for its 
proactive lending policies to the economies and 
infrastructure of the region.  We have therefore no doubt 
that they will equally be able to contribute in an effective 
way towards the development of Iraq's economy and to the 
performance of its banking system. 
 
We understand that three banks have already been licensed to 
operate in Iraq.  We sincerely hope that Arab Bank will be 
afforded the opportunity to operate in Iraq as the fourth 
non-Iraqi Bank. 
 
Yours sincerely, 
 
/S/ 
 
Dr. Umayya Toukan 
Governor, Chairman of the Board 
 
5. Following, for reference, is the text of the letter to 
King Abdullah referred to in paragraph two of Prime Minister 
El Fayez's letter to Administrator Bremer (para 3 above): 
 
Your Majesty: 
 
Allow me to thank you for the courtesy of receiving my 
colleagues during their visit to Amman earlier this month. 
Our discussions with your officials continue and have been 
fruitful. 
 
I appreciate your deep interest in our efforts here and know 
of your wish to find ways of greater economic cooperation 
between Iraq and Jordan.  A primary concern of ours is to 
expand international banking relationships.  I understand 
that the Arab Bank has expressed an interest in Iraq.  They 
are, of course an excellent bank with an outstanding 
reputation. 
 
Because of our needs I have asked two of my close colleagues 
to visit the Arab Bank in Jordan.  They are Peter McPherson, 
Director of Economic Development and Tom Foley, Director of 
Private Sector Development.  I would like them to come to 
Jordan as soon as possible to discuss ways in which the Arab 
Bank of Jordan might be able to assist as in developing an 
urgent program for small and medium-size business loans. 
While we can communicate directly with the Arab Bank, it 
would mean a great deal to us if you could ask them to 
receive my colleagues early in the week so that this 
important work can begin at once. 
 
Thank you once more for your continuing support and 
assistance. 
 
Sincerely, 
 
/S/ 
 
L. Paul Bremer III 
Administrator 
GNEHM