Page 39 - IRANRptSep21

State banks in Iran continue to cut costs by selling off branches surplus to requirements
exports to Iran were worth $4bn, while South Korea’s annual imports from Iran stood at $8bn, according to Radio Farda. South Korea's imports from Iran in the first half of the current Iranian calendar year (began March 20) were valued at a meagre $5mn, it added.
State-owned Iranian banks are continuing with cost-cutting strategies that hinge on shutting down high street banks viewed as surplus to requirements, according to an economy minstry report cited by Donya-e Eqtesad.
Bank Melli Iran (MBI), Bank Mellat, Bank Sepah (sometimes wrongly associated with the Islamic Revolutionary Guard Corps, or IRGC) and Bank Tejarat (Trade Bank) are among those closing branches.
The state lenders have reportedly sold off branch assets for IRR280tn ($1.2bn at the free market exchange rate, but $6.7bn at the official rate) since January 2018 to private developers. The buildings are typically turned into restaurants or are torn down to make way for apartment complexes.
In the period stretching from the start of President Hassan Rouhani's first term in 2013 to the end of 2017, the state banks sold IRR135tn of commercial real estate assets, the report noted.
Successive governments in Iran have mounted increasing pressure over the years to force banks to divest all non-core assets, including companies that have come under their control following bankruptcies, impaired loans and bad debts.
Earlier in August, MBI announced it had divested non-core assets (commercial real estate and other assets) valued at IRR17.4tn ($102) in the previous Persian year (ended March 19).
Last November, MBI failed to find a buyer for the National Development Investment Company, which it listed as having a value of €1.4bn. The business appears to have a level of debt that makes it unattractive to buyers.
Other failed sales concern some retail bank branches in Tehran and elsewhere. MBI and other banks have attempted to dispose of them, but due to the ongoing inflationary effects of the severe devaluation of the Iranian rial, they have struggled to find buyers.
8.2 Central Bank policy
Central Bank of Iran creates framework for credit reference agencies
The Central Bank of Iran (CBI) has published a set of rules on the creation of domestic credit reference agencies.
Previously in Iran, consumers had no way of verifying their credit worthiness due to the total removal of credit cards from the banking system and a limited direct debit system, which failed to build user profiles for potential loanees. Currently, potential loanees need to offer a property deed or another security deposit to obtain an offer of any form of credit.
The credit reference agencies that will be created are expected to analyse both individual and commercial creditworthiness by scoring clients as “very poor,” “poor,” “average,” “good,” or “very good,” in accordance with the CBI guidelines.
Final ratings will be generated after financial assessments are completed on the consumer, covering areas including “overall solvency”, “ability to repay” and “willingness to pay.”
The Iranian credit rating system will also include utility bill payments to national
39 IRAN Country Report September 2021 www.intellinews.com