Page 33 - bne IntelliNews Country Report: Iran Dec17

of the Persian year from March 21, totalling IRR955tn ($25bn), accounting for 64.9% of total credit, or a 13.4% growth y/y.
Another 39.9% of loans valued at IRR397.7tn ($10.4bn) were given to the industries and mines sector. Meanwhile, service sector companies received another IRR626.85tn ($16.4bn) or 40.9% of available credit in the four-month period. This sector is perceived by the banks as a safer bet than traditional industry as its overheads are much less and the risks of defaulting are significantly less historically.
Loans for properties including capped mortgages received a much smaller IRR113.600tn ($2.98bn), which shows that the sector is still flagging overall despite ongoing new building projects across the country.
8.1.2 Deposits
Iran raises maximum deposit limit for foreign residents fivefold
Saving rates fall to 15%
Iran’s Money and Credit Council (MCC), which works under the auspices of the Central Bank of Iran (CBI), has decreed that resident foreign bank account holders can now hold IRR5bn ($131,000) in their account over a 12-month period, the Financial Tribune daily reported on September 8.
The MCC, which meets every three months, is a decision-making advisory body which acts as a go-between the commercial banking sector and banking regulators. Its move, announced following its latest quarterly meeting, pushes the maximum up from IRR1bn ($25,690).
The figure is still short of the annual salary earned by many expatriate workers in Iran. In practice, however, the banks do not bar resident foreigners from placing money in their account. There have never been any reports of foreigners being blocked from adding funds to their account that would push their deposit beyond the previous maximum.
Earlier in February, the CBI stated that to facilitate growth in foreign investment in the country, foreign workers must be given the same local banking sector access as Iranians.
Given that Iran remains disconnected from the majority of foreign banking networks, foreigners are expected to use Hawala-like bank transfers through trusted intermediaries and exchange bureaux.
The Rouhani administration, meanwhile, has raised the limit on cash entering the country via airports to €10,000 or its equivalent. However, Iran maintains strict controls on foreign currency exiting the country. The sum a person may carry is limited to a maximum of €2,000.
Deposit rates on Iranian bank accounts will fall to 15% with daily short-term interest rates fixed at 10% from September 2 in accordance with the plan set out by the Central Bank of Iran (CBI) earlier this month, Banker.ir reported on August 22.
During the past decade, interest rates have historically been above 20% with some credit institutions in Iran offering over 30% for savers. The average loan rate at its highest was 33% in 2009.
33 IRAN Country Report November 2017 www.intellinews.com