Page 39 - IRANRptSep20

merger will mean significant oversight from regulators in the country, and it will be welcomed by the international Financial Action Task Force (FATF) that has subjected Iran to special measures for slowness in applying AML/CFT requirements to loans.
8.1.6 ​Bank news
Bank Melli Iran divests $113mn in non-banking assets
Turkey’s Halkbank fails to remove US judge in Iran sanctions evasion court case
Government-owned Bank Melli Iran (BMI) divested non-banking assets worth Iranian rial (IRR) 26.13 trillion ($621.5mn at the official rate, $113mn at the free market rate) in the first five months of the 2020/2021 Persian calendar year (mid-March to mid-August), the bank announced in a press release.
BMI increased its overall portfolio of assets over the past 40 years since the Islamic Revolution by taking control of, and investing in, enterprises including a minerals company and residential and commercial properties. Other inherited assets included thousands of branches of BMI across the country which by now have either been consolidated with other branches or shut down.
The value of the divested assets was almost three times higher than the value of those sold by the banking group in the entirety of the previous Persian year, the bank noted.
One of the key assets sold is an 81% stake in minerals company Madan Shekafan Tehran Co. The company was sold by the bank in February.
BMI, however, has not been entirely successful with the divesture of its portfolio, with several assets failing to attract buyers. Sales fell flat for several reasons including a lack of buyers and weak demand domestically.
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.
BMI is one of several state-owned enterprises as well as ministries that were instructed to offload assets as part of liquidation efforts after several years of failed investments in projects and companies.
Turkish state lender Halkbank has failed in its attempt to have the US judge overseeing a criminal case accusing it of helping Iran evade American sanctions recuse himself.
US District Judge Richard Berman in Manhattan said in an order on August 24 that Halkbank’s recusal motion had no substantive merit, Reuters reported. He rejected claims by the bank that he was not impartial.
Halkbank co-defendant Reza Zarrab unsuccessfully made a similar bid to recuse Berman four years ago, the order noted.
Zarrab, a wealthy Turkish-Iranian gold trader, was convicted in 2018 for helping Iran evade sanctions. Berman also oversaw that case.
“Haklbank’s recusal motion is a belated rerun of the Zarrab recusal motion, supplemented by 1,014 additional pages of exhibits and two purported expert declarations,” the judge wrote.
US prosecutors have accused Halkbank and bank executives of using money servicers and front companies in Iran, Turkey and the United Arab Emirates to evade sanctions.
They allege that improper transactions included letting revenue from oil and gas sales be spent on gold, and facilitating sham food and medicine purchases.
Halkbank pleaded not guilty on March 31 to bank fraud, money laundering and four conspiracy charges.
A trial date has been set for March 1, 2021.
39​ IRAN Country Report September 2020 www.intellinews.com