Iraq's state banks largely halt lending as 2024 credit plans remain absent

BAGHDAD, Iraq — Most Iraqi state banks have effectively suspended their lending operations, a senior source said on Saturday, citing the absence of clear credit plans for 2024. The source said lending has dropped sharply across construction and renovation loans, small and medium-sized project financing, investment and housing loans, and electronic personal advances. The source attributed the slowdown to the lack of defined credit strategies within the boards of state banks, adding that this has called into question the institutions' role in supporting the economy and the productive sectors. Small and medium-sized projects and investors continue to rely on bank-based financing, according to the source. The source urged the Iraqi government, parliament and the parliamentary Finance Committee to open a file on state bank lending and question the rationale behind the halt in loans and advances by the banks' administrations. It noted that the government program envisions supporting investment and providing project financing through bank credit and related initiatives. The source called for the establishment of clear credit plans containing measurable targets and indicators, without providing further details.