Page 41 - IRANRptSep20

Iran’s central bank plans interbank market for auctioning bonds to strengthen government finances
Iran’s central bank orders commercial lenders to provide 3-month ‘coronavirus grace period’ on loans
series of special measures brought in by the Iranian government to manage the free market, with the Iranian rial (IRR) hitting all-time lows against the dollar this week (by 16:30 Tehran time on June 25 it had recovered some ground to stand at IRR192,000 versus the USD, compared to the​ ​weakest ever rate of IRR205,000 seen on June 23​).
The updated central bank rules add that those who have more than €10,000 or its equivalent in hard currency have three months to either deposit their cash in a foreign currency bank account or sell it at an exchange bureau or credit institution. It remains unclear how this method will be policed or if fines will be levied on those who fail to comply.
According to the governor of the CBI, Abdolnaser Hemmati, some $280bn has been injected into the local foreign exchange market in the past 15 years to support the rial.
The regulations for taking hard currency in cash out of Iran have not been changed. There is a limit of €5,000 that applies to those travelling by air, whereas the limit is €2,000 for those travelling by land.
This is while there is no limit on carrying foreign currency into Iran. Those bringing in hard currency may do so potentially with no questions asked.
The Central Bank of Iran (CBI) is planning to open a primary interbank market for auctioning bonds to help the government raise funds, the Financial Tribune​ reported on May 14.
As part of a plan to divest assets of the banks to the markets, the bond system is seen as the most direct and profitable option as there is a clear upward trend in the number of Iranians becoming interested in investing in the local capital markets.
Lenders would place buy orders for government bonds through a new interbank trading platform to be established.
Bond orders would be processed by the CBI and sent to the economy ministry for finalisation. Brokerages would then settle payments within 24 hours. Raising funds for the government within the debt market is seen as a pivotal objective for the Rouhani administration. It is struggling to plug gaps in its accounts that have become more profound due to the impact on the economy of the coronavirus (COVID-19) pandemic and plunging oil prices.
The Central Bank of Iran (CBI) has ordered all commercial banks to offer a three-month repayment grace period on loans to counter financial difficulties caused to people by the coronavirus pandemic.
Iranian businesses are losing millions of dollars a day due to the collapse of footfall in the country, with so many people staying indoors and not venturing out to raise their chances of not contracting the virus, also known as COVID-19.
The CBI took its decision following an approval given by the governmental Money and Credit Council to help commercial operators through the ongoing epidemic, which had claimed around 400 lives in Iran by the end of March 11.
The World Health Organisation’s (WHO's) emergencies head Michael Ryan said on March 11 that the COVID-19 situation in Iran was "very serious". The WHO had sent 40,000 testing kits to Iran but there was still a shortage of
41​ IRAN Country Report September 2020 www.intellinews.com