Generally, IMMDF offers loans for the following purposes:

  • Purchase of new and used local and foreign equipment
  • Expansion of factories and warehouses
  • Construction of infrastructure projects
  • Purchase of inventory
  • Working capital

Subject to credit assessment of specific projects, IMMDF offers loans up to US$ 5,0 million under the following indicative terms:

  • Interest rate: 7.0% p.a.
  • Fees: 1.0 to 3.0% p.a.
  • Maximum tenor: December 2019
  • Payments: monthly or quarterly
  • Grace periods: case by case basis
  • Financial statements: externally audited
  • Financial reports: quarterly, annual

IMMDF lends against the capacity to repay of projects, not against the collateral they can offer. Collateral however, is required in an amount representing approximately 150% of the loan amount, including interest and fees.

Depending on the specific project, collateral may take the form of mortgages on land, liens on shares and equipment, corporate and personal cheques, corporate or personal promissory notes and corporate or personal guarantees.

To qualify for an IMMDF loan, projects must present / demonstrate the following:

  • Three to 5-year prior financial statements, preferably externally audited
  • An established market presence
  • Experienced management
  • A solid business plans, clearly demonstrating
    • generation of employment and economic grow img_rightth
    • a profitable, viable and sustainable project
    • the purpose of the loan
    • evidence of anticipated revenues
    • risk analysis and mitigation elements
    • sufficient collateral properly valued
  • Capacity to submit accurate and periodic commercial and financial reports

Loan applications must include at least the following information:

  • Business plan, including detailed financial projections
  • Articles of incorporation and by-laws of the applicant
  • Licenses, registrations or authorizations to trade, if applicable
  • Three to 5 year prior financial statements of the applicant, preferably externally audited
  • Business and bank references for the applicant
  • Information on the owners and key managers of the applicant
  • Other documentation or information as required by IMMDF on a case by case basis

IMMDF monitors the compliance of borrowers with their obligations under their loan agreements, and their commercial and financial performance by:

  • visiting borrowers on a monthly basis
  • urging borrowers to comply strictly with their commercial and financial reporting obligations
  • comparing the borrowers’ actual financial performance with the financial projections in IMMDF’s Credit Proposal for the particular loan to its Credit Committee
  • comparing the commercial and financial performances of borrowers carrying out similar activities
  • keeping informed of Iraqi national industry trends and developments
  • exchanging relevant market information with certain Iraqi commercial banks

In assessing the borrowers financial and commercial performance and their compliance with the requirements in their loan agreements, IMMDF focuses on the following:

Income Statement

  • Gross revenues
  • COGS as % of Revenue
  • Direct Costs as % of Revenue
  • EBITDA
  • Profit margin

Balance Sheet

  • Liquidity
  • Accounts Payable
  • Accounts Receivable, Aging Schedule
  • Inventory
  • Financial ratios

IMMDF will support its borrowers to the largest possible extent. Their success is our success. This is why IMMDF has restructured loan terms to accommodate the financial needs of projects when market conditions are adverse.

Our ability to restructure loans however, is not indefinite. We also have our financial obligations to meet. When projects fail due to commercial reasons or when the borrower defaults and is not transparent about the reasons, IMMDF must take court action to recover the loan.

IMMDF has been able to enforce a number of loan agreements in Iraqi courts, confirming that the Iraqi judicial system is prepared to protect the rights of creditors to be repaid their loans.