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Smoke rises over central Baghdad on Sunday, following a series of explosions. Image Credit: AP

Baghdad: Suicide bombers and gunmen wearing military uniforms killed 15 people and took hostages on Sunday in a daring raid on the Iraq Central Bank in Baghdad, triggering an ongoing siege with security forces.

The violence began at around 2:50pm (1150 GMT) when a suicide attacker wearing an army captain's uniform detonated his payload near the building, causing multiple casualties, a high-ranking defence ministry official said.

Most of those killed in the raid were bank workers, with a further 43 people wounded, and many other employees are being held captive inside, he said.

The attackers took control of the building as a total of eight explosions sounded throughout the area in less than an hour amid exchanges of gunfire and as army helicopters circled overhead.

The gunmen were continuing to occupy the building and the attackers had posted snipers on the roof of the bank in an attempt to deter police and soldiers from wrestling back control, according to the defence official.

Major General Qassim Atta, a spokesman for the security forces in Baghdad, said soldiers and police were "besieging" the attackers whom he described as "a terrorist group."

He said it was unclear if they had intended to rob the bank, target its employees, or destroy the building.

The audacious attack came one day before the reopening of the conflict-torn nation's parliament, the country's second democratic grouping since the US-led invasion that ousted dictator Saddam Hussain in 2003.

In other violence on Sunday two policemen were shot dead by insurgents in the restive city of Mosul, 350 kilometres north of Baghdad, said a security official.