The Impact of Securitization on the Financial Performance of Banking Sector in Iraq

Abstract

Securitization is one of the most important tools of financial engineering, because of its great importance in raising the efficiency of the financial performance of banks, which lies in providing liquidity reducing the risks of external financing, getting rid of bad debts, attracting local and foreign savings and other roles that reflect a positive image on economic development.

Despite the important role of securitization, the banking sector in Iraq as far as  it is known,, have not yet used it and thus investors and capital owners  have not dealtwith it  as well. . Hence, the study aimed to analyze the impact of securitization of banking assets on the efficiency of the financial performance of the Iraqi banking sector. In order to achieve thisobjective  , this study used a questionnaire distributed on employees from various positions working in Rafidain Bank during the year  2022 -2023.and the data was analyzed using  the  SPSS program. The study also usedthe quantitative method by analyzing the accounts of the bank's general budget.

 The study found thatlarge percentage of  the employees  agreedthat securitization should be used in the bank because of its benefits in achieving profits and paying risks for the bank. They also confirmed that securitization gives the bank the ability to monetize its assets easily, and supports the bank's capital, raises its efficiency and improves its financial performance in the future.

The study recommends developing solid risk management plans, improve capital raise asset quality, digitize and automate processes, enhance and facilitate digital processes and procedures, develop a culture of training and continuous development of employees, and eliminate waste.