GuarantCo completes its first transaction in Iraq, a partial guarantee for a portfolio of USD 70 million for the National Bank of Iraq to grow the bank’s climate adaption and mitigation infrastructure portfolio

GuarantCo, part of the Private Infrastructure Development Group (PIDG), has closed its first deal in the Iraqi market with a USD 35 million portfolio guarantee for the National Bank of Iraq (NBI), for a portfolio of USD 70 million.

NBI is a majority-owned (62 per cent) subsidiary of Capital Bank of Jordan (CBJ), an existing client of GuarantCo to which it provided a portfolio guarantee in 2024. GuarantCo also supported CBJ in aligning its Health, Safety, Environmental and Social, and Diversity and Inclusion governance with international standards.

This guarantee, covering an existing portfolio of loans, will provide immediate capital relief to NBI, enabling the bank to increase its lending to clients operating across multiple sectors with a climate focus and developmental angle including housing (green/EDGE-certified), manufacturing and agriculture.

This transaction, denominated in Iraqi Dinar (IQD) equivalent, represents a milestone partnership with one of Iraq’s most established commercial banks. It aims to mobilise private sector capital and strengthen the local financial system. The financial sector in Iraq has a crucial role to play in the country’s economic diversification and sustainable development away from its oil sector dependency, currently accounting for over half of its GDP.

Despite its challenging history, Iraq has experienced its most politically and economically stable period in decades. Improving macroeconomic indicators and increasing international investor interest led Fitch to upgrade Iraq’s credit rating to B- in November 2024. Classified as a Fragile and Conflict-Affected State, Iraq has a significant infrastructure gap and low financial inclusion, which aligns to PIDG’s Strategy 2030 to strengthen and build underdeveloped markets in the Middle East, North Africa and Pakistan region.

This transaction will make a direct contribution to UN Sustainable Development Goal (SDG) 8 – Decent Work and Economic Growth and 9 – Industry, Innovation and Infrastructure. More than 60 per cent of capital will support business and projects that are contributing to climate mitigation and can be classified as climate finance.

Chinmay Naralkar, Deputy CEO, GuarantCo said:

“We are pleased to have finalised this deal with NBI and to enter the underserved Iraqi market in a prudent and high-impact way. It is the embodiment of our strategic approach to replicate transactions with trusted and existing partners, in this case Capital Bank of Jordan, to tap into new markets with an urgent infrastructure finance need. This transaction is perfectly aligned with our drive for market transformation in developing economies to deliver against the UN’s Sustainable Development Goals and the PIDG 2030 Strategy.” 

Ayman Abu Dhaim, CEO of the National Bank of Iraq, said:

“This partnership with GuarantCo marks a significant strategic milestone in strengthening our financing capabilities and enabling us to support key sectors that drive the diversification of Iraq’s economy. The guarantee will allow the bank to expand its lending portfolio to productive and sustainable projects, including green housing, industry, and agriculture—sectors that form a cornerstone of the country’s development journey.

“At the National Bank of Iraq, we believe that strong partnerships between local financial institutions and reputable international organisations can create real impact by driving economic transformation, enhancing financial inclusion, and generating job opportunities—fully aligned with Iraq’s vision for a more stable and sustainable future.”