Iraqi bank lending tilts toward private sector

Shafaq News- Baghdad

The private sector held close to 65 percent of all bank credit in Iraq at the end of May 2026, even as total lending and deposits across the banking system fell for a third straight month, according to official Central Bank of Iraq figures.

Private-sector borrowers took 47.329 trillion dinars of the 73.173 trillion dinars in cash credit outstanding at the end of May. The central government accounted for 23.420 trillion and public institutions for 2.424 trillion. Cash credit is the loans and facilities banks extend to the government and to the public and private sectors.

Total cash credit slipped from 73.832 trillion dinars in March to 73.637 trillion in April and 73.173 trillion in May.

Deposits followed the same downward path, easing from 105.090 trillion dinars in March to 104.727 trillion in April and 104.296 trillion at the end of May.

The private sector also held the largest single block of deposits, 49.615 trillion dinars, or about 47.6 percent of the total. The central government held 31.791 trillion and public institutions 22.890 trillion. Deposits supply the liquidity banks use to finance economic activity.

The figures mark the third consecutive monthly decline in both deposits and credit, according to the data reviewed by Shafaq News.