European banks willing to resume activities in Iran: official

March 2, 2016 - 0:0

TEHRAN- European banks are showing eagerness to resume activities in Iran now that the sanctions are being lifted against the Islamic Republic, according to Ali Divandari, director of Iran’s Monetary and Banking Research Institute (MBRI).

Divandari made the remarks in a press conference on Tuesday to expound on programs and objectives of “The 2nd Business and Banking Forum Iran Europe” which will be held in Tehran from March 5 to 7.

He said that in the first edition of the event, which was held in Frankfurt on November 18-19, 2015, it was decided to hold the second edition in Tehran upon removal of the sanctions.

The forum is to strengthen ties between Iranian and European banks and also boost cooperation between Iranian banks and foreign investors, Divandari stated.

He mentioned export financing and Iranian banks’ rejoining to the global banking system as the other objectives of the forum.

The MBRI’s director said Central Bank of Iran (CBI) Governor Valiollah Seif and five Iranian ministers will deliver speech in the forum.

*** ‘Iran-Europe Forum to host 60 foreign participants’

Divandari further stated that the forum will host about 60 foreign participants mainly from Germany.

He said other foreign participants will be from France, Britain, Italy, Poland and Russia.

The participants are active in the fields of banking, auditing, consulting and payment services, as well as engineering, industry and energy sectors, he added.

The governors of some famous European banks are among the participants, he highlighted.

*** ‘Promotion of Iran-Europe banking ties’

The MBRI’s director went on to say that Iranian banks have branches in the main European countries such as Germany and France; although their activities have been limited due to the sanctions.

“We should work for promoting our banking relations with the European countries and this forum can be of help in this regard”, Divandari asserted.

*** ‘Japan, China could be good start for issuing credit cards’

Elsewhere in his remarks, Divandari said, “In the past, Iranian banks had access to services such as Master Card and Visa Card via some third parties, but now they are seeking to act independently in this due.”

“A Japanese company and a Chinese one have already expressed readiness to issue credit cards for Iran. Although they do not cover a large market, it would be a good start for us”, he noted.

In early 2012, the Society for Worldwide Interbank Financial Telecommunication (SWIFT) said it had been instructed by the European Council to discontinue its communications services to Iranian financial institutions that are subject to European sanctions. Accordingly, it blocked 30 Iranian banks from using its service thus literally cutting off Iran from the global banking system.  

With the nuclear deal that led to the lifting of international sanctions against Iran on January 16, Iran is back in the global banking business, able to use the worldwide transaction network SWIFT, the Belgian based cooperative which handles cash transfers and letters of credit between financial institutions.

On January 31, Seif said that SWIFT has restored its services to 9 Iranian banks.

Melli Bank, Tejarat Bank, Mellat Bank, Sepah Bank, Bank of Industry and Mine, Post Bank, Export Development Bank, Refah Kargaran Bank, and the Central Bank will rejoin SWIFT, he added. 

Also, global banks are showing interest in opening branches in Iran following sanctions removal.

In early February, Austria’s Raiffeisen Bank International (RBI) said it wanted to open a branch in Tehran “as quickly as possible,” becoming the first foreign lender to set up shop in Iran after the lifting of sanctions.