A US air strike has destroyed an Islamic State (Isis) cash storage facility in Iraq containing currencies estimated to be worth millions of dollars. The warehouse, located in the town of Mosul, was pounded by two 2,000-pound bombs although it is not known exactly how much money or which currencies were kept at the compound.

"We estimate in the millions of dollars... from all their illicit stuff: oil, looting, extortion," US defense officials said, adding that more Daesh facilities such as these would be targeted to "take away their [Isis's] ability to function as a state-like entity".

However, officials did not disclose how they learnt about the location of the warehouse and what its contents were. The air strikes were carried out on 10 January.

In the past year, US forces targeted IS cash storage facilities and recently have started attacking illicit oil trucks making their way out of Syria. It is reported that before carrying out the air strikes on the Mosul compound, the Isis warehouse had been closely monitored for days to figure out how to minimise civilian casualties.

Earlier, the US had said that collateral damage would be considered if targets were of high priority. Defense officials believe that between five and seven civilians were killed in the air strikes.

US air strikes on Isis cash storage facilities and oil tankers will dent the extremists' finances, but it is not known how hard the militant group will be hit as it also generates revenue from Zakat – an obligatory tax in Islam, which requires Muslims to give a certain share of their income to fighters involved in a holy war.

The revenue generated from Zakat is almost equal to the money they generate from the sale of illicit oil. The terror outfit raises an estimated $450m (£310m) per year from oil sales.