Shafaq News – Baghdad

The fresh round of US sanctions on Iraqi entities has undermined confidence in the country’s banking institutions, a senior financial expert revealed to Shafaq News on Wednesday.

As part of a steadily expanding wave of US measures over the past two years targeting Iraq’s banking sector, the US Department of the Treasury last week imposed new restrictions on Al-Muhandis General Company—the economic arm of the Popular Mobilization Forces (PMF)—along with several prominent bankers and firms accused of facilitating transactions for Iran’s Islamic Revolutionary Guard Corps (IRGC) and its Iraqi ally, Kataib Hezbollah.

Read more: Sovereignty strain: US sanctions trigger Iraq's liquidity nightmare

Mahmoud Dagher, a former director at the Central Bank of Iraq (CBI), explained that although the sanctions’ direct impact is limited, including a state-owned company in the list may rattle investors and disrupt financial stability. “Without this confidence, the economy becomes unstable,” he warned, predicting that further rounds of US sanctions are likely.

Analysts, meanwhile, go beyond the financial dimension, viewing the new restrictions as part of a broader pattern of political and security pressure.