THE IMPACT OF SHIFTS IN BANKING SERVICES UNDER TREASURY SANCTIONS AND THE INTENSIFICATION OF COMPETITION IN THE IRAQI BANKING ENVIRONMENT

This research examines the reality of banking services in Iraq, with a focus on the impact of U.S. sanctions imposed in late 2022 on a number of Iraqi banks. The study analyzes the performance of two banks as contrasting models: Middle East Bank, which was subjected to sanctions, and National Bank of Iraq, which was not. The findings revealed that banks heavily reliant on the foreign currency auction window were severely affected after the sanctions (Middle East Bank), while banks with diversified income sources and advanced technological infrastructure were able to adapt and achieve positive outcomes (National Bank of Iraq).The study recommends that relevant authorities in Iraq,whether regulatory or banking institutions, work on establishing flexible and innovative approaches to address international sanctions. This includes building multiple banking relationships and enhancing transparency and compliance to mitigate external pressures and ensure the continuity of banking operations during challenging times.