The Role of Financial Restructuring Indicators in Enhancing Financial Stability: An Analytical Study of a Sample of Iraqi Private Banks (2012–2024)

Abstract

This study examines the role of financial restructuring indicators—including debt, capital, and asset restructuring—in enhancing the financial stability of eight (8) selected Iraqi private banks during the period from 2012 to 2024. Financial stability was assessed using measures of capital adequacy, liquidity, asset quality, and profitability. The research adopted a descriptive-analytical framework for theoretical grounding and a quantitative-analytical approach for empirical testing of correlations and effects. The main findings demonstrate a statistically significant positive relationship between financial restructuring indicators and financial stability. Capital restructuring emerged as the most important factor in enhancing capital adequacy, while asset restructuring significantly contributed to improving overall asset quality. The study concludes that financial restructuring serves as a vital safeguard against financial shocks. It recommends that Iraqi private banks adopt proactive restructuring strategies and implement quantitative early warning systems aligned with Basel standards to ensure long-term resilience and sustainable financial stability.