The internal public debt and its impact on the interest rates of Iraqi banks for the period from 2004-2020

Abstract

The research aims to analyze the internal public debt and its effect on interest rates on loans and deposits for commercial banks and to find out the extent of the impact of this debt on interest rates for loans and deposits as well as diagnosing the financial policy in terms of strengths and weaknesses in Iraq, especially the management of public debt on the one hand and the ability of the banking sector in Supporting the government to face the financial crises it is exposed to. The research started from the problem of the worsening deficit of the government budget and resorting to internal borrowing and the extent of its impact on the interest rates of commercial banks. The research reached a set of conclusions, the most important of which is the increase in the internal debt ratio from 13% of total public debt to 2010 To 33.6% of the total public debt for the year 2015 and is still increasing continuously, reaching 66.5 of the total public debt for the year 2020, and that interest rates on fixed and savings bank deposits are moving in a downward direction and continuously from 2007 to 2020. The research recommended the need to properly manage the public debt and set plans In the medium term, to address crises and work to monitor interest rate movements periodically and determine their impact on the elements of investment banking, especially a To invest in a cash credit portfolio and reduce the margin between interest paid on deposits and received from borrowers.