Iraq’s Central Bank (CBI) reported a 1% decline in deposits but a notable rise in lending during July 2025, reflecting shifting dynamics in the country’s banking sector.
According to Iraq’s Central Bank (CBI) data, total deposits in banks operating across Iraq fell to 116.27 trillion dinars ($822.3 billion), down from 117.44 trillion dinars ($830.6 billion) in June. The decline came as government and institutional deposits dropped slightly, while private sector balances showed limited growth. Of the total deposits, 36.22 trillion dinars ($256.2 billion) came from the central government, 25.44 trillion dinars ($180 billion) from public institutions, and 54.59 trillion dinars ($385.9 billion) from the private sector.
Despite the fall in deposits, lending activity increased. Total credit rose by 2% to 73.03 trillion dinars ($516.6 billion) in July, compared to 71.48 trillion dinars ($505.4 billion) in June. The data shows stronger credit distribution to both government and private entities, indicating sustained demand for financing amid economic recovery efforts.
Credit extended to the central government reached 25.77 trillion dinars ($182.3 billion), while loans to public institutions totaled 2.43 trillion dinars ($17.2 billion). The private sector received the largest share, amounting to 44.83 trillion dinars ($317.1 billion).
Economists note that the rise in bank lending suggests improving business confidence and ongoing liquidity support from the CBI. However, the slight decline in deposits may reflect tighter fiscal spending or seasonal financial adjustments within public and private institutions.
The Central Bank continues to monitor liquidity levels and credit performance as it aims to maintain financial stability while supporting growth.