Page 37 - IRANRptNov20

Iran moves to ease additional financial strain on citizens as COVID-19 crisis continues
Foreign companies that do business with those banks have been given 45 days to wind down their operations before facing "secondary sanctions."
"Our maximum economic pressure campaign will continue until Iran is willing to conclude a comprehensive negotiation that addresses the regime's malign behavior," US Secretary of State Mike Pompeo said in a statement.
Iranian President Hassan Rouhani has announced further plans to ease financial strains on citizens amid the coronavirus (COVID-19) crisis, ISNA reported.
The Central Bank of Iran (CBI) previously announced that it would offer a commercial loan repayment holiday of ​three months​ for businesses in the country.
But as part of wider efforts, employees can now defer health insurance, income tax payments and utility bills for up to the next three months starting from March 17.
In addition, the monthly stipend sent to the poorest deciles of Iran will be increased during the continuing Covid-19 outbreak in the country.
Banks have, meanwhile, been instructed to remove restrictions and limits on cheque payments for businesses.
8.1.1 ​Liquidity / assets
Iran’s liquidity expands to IRR18.82 quadrillion in Persian year ending March 2019
The Central Bank of Iran (CBI) has reported on July 8 rial liquidity grew 23.1% to reach IRR18.82 quadrillion (around $447bn) in the previous Persian calendar year (to March 20).
Liquidity continues to grow due to the devaluation of the rial against a basket of other currencies. With prices continuing to creep upwards, the pace of growth is likely to be higher than the CBI’s official statistics.
The share of M2 money stood at in March at IRR2.85bn (more than $67.6bn) “Quasi money” – money sitting in bank savings accounts – stood at IRR15.97 quadrillion (above $379bn) registering a growth of 19.6% y/y.
Overall, banks and financial institutions in the country are said to hold above IRR1 quadrillion in assets, which the domestic economy is struggling to reabsorb.
8.1.2 ​Loans
Iran’s banks ‘lent IRR9,750 trillion to businesses in 2019-2020 Persian year’
Iran’s banks lent Iranian rial (IRR) 9,750 trillion ($62.9bn at the free market rate, $232bn at the official rate) to businesses in the 2019-2020 Persian year (ended March 19), marking a rise of IRR2,012tn or 26% y/y, according to Central Bank of Iran (CBI) data published by DEN Group on April 30.
Companies across the board in Iran suffered significant losses during the Iranian calendar year, with the severe US-sanctions-triggered depreciation of the rial against hard currencies and other market impacts of the sanctions making life very tough for the business world.
The CBI said in its annual report on the performance of the country’s banks that the services sector received IRR3,285tn, or 34%, of the awarded loans. The industries and mining sector was the next biggest beneficiary, accounting for IRR3,172tn, while companies in commerce received 19% of the total. Looking at loan amounts and destinations, the CBI said companies in services received an average $5,300 at the free market exchange rate, while the
37​ IRAN Country Report November 2020 www.intellinews.com