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A soldier stands guard near the site of a bomb attack in Baghdad on Sunday. Image Credit: Reuters

Baghdad: Iraqi officials say at least 27 people have been killed and more than 55 wounded in a twin car bombing in a crowded area outside a state-run bank in Baghdad.

Police and hospital officials say the casualty toll has risen as more victims are pulled from the debris after Sunday's devastating blast.

The explosives-packed cars were a few hundred metres apart when they blew up shortly after 11 a.m. as the area was crowded with people at the start of the work week.

The officials spoke on condition of anonymity because they weren't authorised to release the information.

Persistent bombings in Baghdad and surrounding areas have raised fears that insurgents are stepping up attacks in a bid to foment unrest by exploiting political deadlock following inconclusive March 7 elections.

Last week, suspected Al Qaida in Iraq militants stormed the central bank and exchanged gunfire with Iraqi security forces in a standoff that brought part of the capital to a standstill.