ERBIL, Kurdistan Region of Iraq – The Governor of the Central Bank of Iraq (CBI) Nizar Nasser reassured depositors that the “vast majority” of their funds in the banking sector are guaranteed, adding that there are around 107 trillion Iraqi dinars in circulation.

Nasser said that “the vast majority of deposits in the banking sector are guaranteed” during a meeting on Sunday, according to a statement from the CBI. The governor reassured that “in the event of any disruption or deficit, the Central Bank will intervene within its powers and responsibilities.”

The governor said “international confidence in the Central Bank of Iraq is very high, and that internal oversight has been strengthened, and preventative measures have been taken regarding financial and banking institutions,” adding that the bank is “capable of managing crises.”

Iraq ranks at the top of Arab and Middle Eastern nations in the number of banks with 81 institutions, but banking services still fall below expectations, a financial monitor said in July.

Iraq’s banking system suffers from rampant corruption, with most citizens reluctant to keep their capital in banks and opting to retain cash at home.

Despite the challenges, the country has striven to revitalize its banking sector in recent years, with financial officials repeatedly calling on citizens to place greater trust in the banking system and deposit their savings in banks.

Of the 81 institutions, 24 are local commercial banks, 31 are local Islamic banks, and eight are government banks, according to data from the Eco Iraq Observatory. There are also 16 foreign banks and two representative offices of foreign banks. The organization said Iraq still lacks a fully integrated bank.

Iraq has been eyeing a move to slash three zeroes from its currency. Currently, $1 is equal to around 1,320 dinars per the Central Bank’s official exchange rate.

“The total currency issued for circulation is approximately 107 trillion Iraqi dinars,” Nasser explained, adding that a planned currency reform will “contribute to determining the true amount of money circulating in the markets.”

Jamal Kocher, a Kurdish member of the Iraqi parliament's finance committee, told The New Region in late August that Prime Minister Ali al-Zaidi “has requested removing zeros from the bills.”

Earlier in August, Communications Minister Mustafa Sanad confirmed that the decision to remove the zeros and change the currency had been made.

Days later, the CBI denied reports suggesting it had already started printing new money with the zeros removed, adding that the move would require lengthy legal processes.