53 other people were wounded in the blasts that blew in the windows of the bank, one of the public sector's most active financial institutions and at the forefront of efforts to encourage foreign investment as the sectarian bloodshed set off after the 2003 U.S.-led invasion fades.

Baghdad security spokesman Major General Qassim al-Moussawi said two cars packed with around 80 kilograms of ammonium nitrate each were driven at the gates of the Trade Bank of Iraq and detonated on striking blastwalls protecting the building.

He put the initial death toll at 18, but an Interior Ministry source said later it had risen to 26.

The blasts left two charred craters a few meters apart in the main thoroughfare in front of the bank.

The building was badly damaged. Five guards were killed and six wounded, said bank chairman Hussein al-Uzri in a statement. "However, this cowardly attack was a failure. The Trade Bank of Iraq, and Iraq itself, are undeterred," Uzri said.

A bank employee who asked not to be identified said the damage and toll would have been worse had guards not protected it and its windows not consisted of shatterproof glass.

At least two of the dead were police officers guarding a nearby Interior Ministry office that issues Iraqi identity cards, ministry sources said.