The UAE has no assets of the former Iraqi government or Iraqi companies but the Central Banks of the UAE and Bahrain will be the supervisory authorities for the branches of Iraq's Al Rafidain Bank in their respective countries, the governors of the Central Banks said yesterday.

The Iraqi government-owned Al Rafidain Bank has a branch each in Abu Dhabi and Bahrain.

"There are no accounts of any Iraqi company or the Iraqi government in the UAE and, therefore, no accounts have been frozen," said Sultan bin Nasser Al Suwaidi, UAE Central Bank Governor, on the sidelines of the Arab finance ministers meeting.

"We are going to supervise the Al Rafidain Bank until a legal government is established in Iraq," Al Suwaidi said, adding that "due to the unexpected situation in Iraq, we have to supervise the bank in the UAE".

Sheikh Ahmed Al Khalifa, Governor, Bahrain Monetary Agency (BMA), told Gulf News that the BMA may also supervise the Iraqi bank's operations in Bahrain. "The bank has small operations in Bahrain. We are monitoring the situation...We may have to supervise it," he said.

Asked if the Central Bank is ready to provide funds to the bank, Al Suwaidi said the matter is receiving attention.

"The capital of the bank should not fall below the limit prescribed and the Central Bank has the right to raise the capital. But in this case, since there is no owner right now, we must see what needs to be done. We do not know yet," Al Suwaidi said.

Nor has the UAE Central Bank decided on making deposits in Al Rafidain Bank. "We have no intention of doing this for the time being," he said.

The UAE Central Bank has also postponed the hawala conference which was to take place in Abu Dhabi. "Due to the outbreak of the SARS disease, the conference has been postponed."

Al Suwaidi said that Arab funds have performed well in the past years, but added that they need to exert more efforts to further push up the trend of development.