Iranian Rial

[screwball]

ank sees no limitations for banking co-op with Iran

Tehran, Dec 9, IRNA – Governor of the Czech National Bank (CNB) Jiri Rusnok said on Friday that CNB sees no limitations for banking cooperation with Iran.

 

Speaking during a meeting in Prague with Iranian Minister of Economic Affairs and Finance Ali Tayyebnia, the CNB governor voiced support for the activities of Czech banks and companies in Iran. 

Tayyebnia has travelled to Prague to attend the 1st Iran-Czech Republic Joint Economic Commission session. 

During the meeting, the Iranian minister underlined the need for boosting banking brokerage ties between the two countries to facilitate Tehran-Prague economic cooperation. 

Figures released by the Czech Statistical Office suggests that Iran-Czech Republic economic relations rose up to $52 million in 2015, showing a 50% increase since a year ago. 
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[screwball]

Iran presidential chief of staff, Swedish minister discuss banking co-op

Stockholm, Dec 9, IRNA – Iran's Presidential Chief of Staff Mohammad Nahavandian and Swedish Minister for Finance Magdalena Andersson, in a meeting in Stockholm on Friday, discussed issues of mutual interest, including banking cooperation between the two countries.

 

After the session with the Swedish finance minister, Nahavandian reportedly met with Sweden's Prime Minister's State Secretary Hans Dahlgren. 

He is also scheduled to meet with Sweden's Minister of EU Affairs and Trade Ann Linde later in the day. 

Nahavandian arrived in the Swedish capital on Thursday evening for meetings with top-ranking economic officials of the country.  

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[screwball]

 

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Iran, Czech Republic agree to boost economic relations

Tehran, Dec 9, IRNA – During the Joint Economic Commission meeting in Prague, the capital of the Czech Republic, Iran and the Czech Republic agreed to boost cooperation in different economic sectors.

 

Both sides signed agreements in petrochemical, economic and industrial fields including bus, train wagons, electrical and diesel locomotives, small planes and helicopter manufacturing. 

The agreements were signed for Iran by Minister of Economic Affairs and Finance Ali Tayebnia and Chairman of Czech-Slovak-Iranian Chamber of Commerce Jan Kavan.

A number of senior economic officials from both countries were present in the event as well.

During the event Iran and the Czech Republic also signed a number of cooperation documents.

Based on Czech statistical administration, economic ties between Iran and the Czech Republic showed a 5-percent growth in 2015 and the volume of exchange was $52m.

The figure, indicating a 10% rise, reached $27,100,000 during the first half of 2016 while the figure stood at $24,236,000 during the same period last year.

Tayyebnia has travelled to Prague to attend the 1st Iran-Czech Republic Joint Economic Commission session. 
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[screwball]

 

Iran, Czech exchange level to hit $500m in 2 years

Tehran, Dec 9, IRNA - Iran's Economic Affairs and Finance Minister Ali Tayyebnia expressed hope for the exchange volume between Iran and the Czech Republic to reach $500m in two years.

 

Addressing the Joint Economic Commission meeting in Prague, Tayyebnia said on Friday that the volume of trade exchange between the two countries amounted to about $52m in 2015.

He said there is still room for both countries to work to grow the figure.

He reiterated that Iranian government has put developing exchanges on the agenda and regarding the variety of economic capacities and many competitive advantages in Iran and also variety of fields and sectors, taking advantage of foreign technical and financial capacities is classified as fundamental principles of the government.

There are many capacities for cooperation in infrastructural and developmental projects, namely in constructing railways and roads, developing airports, subway lines, building power plants with focus on renewable energies, constructing steel factories, study, exploration, exploitation and development of oil and gas fields building petrochemical complexes and developing agricultural activities, he noted.

He added that Iran and the Czech Republic have no limitation in developing economic cooperation. 

'Due to lifting crippling financial and banking sanctions imposed on Iran and Iranian banks' commitment to international principles and rules in fighting money laundering, terrorism financing and the clarification of international banking ties, we expect to see practical and serious steps to resume banking ties with Iranian banks', Tayebnia said. 

Based on Czech statistical administration, economic ties between Iran and the Czech Republic showed a 5-percent growth in 2015 and the volume of exchange was $52m.

The figure, indicating a 10% rise, reached $27,100,000 during the first half of 2016 while the figure stood at $24,236,000 during the same period last year.

Tayyebnia has travelled to Prague to attend the 1st Iran-Czech Republic Joint Economic Commission session.

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[markb57]

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[screwball]

CBI: No Interest Rate Cut Until March 

1. Economy
2. Business And Markets

Saturday, December 10, 2016

CBI: No Interest Rate Cut Until March 

 

 

 

Iranian banks have no plans to further lower interest rates until the end of the current fiscal year that ends on March 20.

Ali Asghar Mir-Mohammad Sadeqi, director of Central Bank of Iran’s Credit Department, said “lowering interest rates is unlikely until the end of the year, considering the current state of the economy and the banking sector”, CBI’s website quoted him as saying during a press conference on Wednesday.

Mir-Mohammad Sadeqi did not elaborate.

Back in June, CEOs of private and state-owned banks agreed to lower long-term deposit rates from 18% to 15% with short-term rates set at approximately 10%. Later, the Money and Credit Council approved the cut.

CBI Governor Valiollah Seif later announced that the central bank seeks single digit interest rates, approximately 2-3% higher than the inflation rate.

The central banker went on to elaborate on rates in the interbank market, saying that some of the government’s recent plans, including  financing SMEs and purchasing wheat at guaranteed prices, have put pressure on the banking system, resulting in a surge in interbank rates.

“Currently, the average interest rate at the interbank market stands at 18.9%,” he said, noting that CBI has managed to prevent higher rates in the market.

The interbank market funding rate had gradually declined from a record high of 29% at the beginning of March 2015 to 17 % early this year.

Mir-Mohammad Sadeqi also noted that MMC is set to review new proposals for mortgage schemes.

“The plans are developed in cooperation with the Ministry of Roads and Urban Development and Bank Maskan, the state-owned lender specialized in Housing sector. The CBI is firmly trying to boost the housing sector,” he said, adding that more details will be announced in the coming weeks.

 Credit Cards

The official also elaborated on the current state of the credit card scheme by saying banks have issued 305,000 credit cards so far.

“Currently Bank Mellat, Bank Refah, Bank Melli Iran, Tejarat Bank, Bank Sepah, Post Bank of Iran, Ayandeh Bank, Shahr Bank, Ansar Bank, Parsian Bank, Middle East Bank and Bank Pasargad Iran are offering credit cards to customers,” Seif said.

The entire banking system was supposed to take part in the scheme.

Back in September, the Central Bank of Iran announced that banks will offer three types of credit cards: Golden with a limit of 500 million rials ($14,000 at market exchange rate), Silver with a limit of 300 million rials ($8,400) and Bronze with a ceiling of 100 million rials ($2,800), based on the applicants’ creditworthiness measured by banks.

However, early reports indicated lenders’ unwillingness to participate in the scheme due to consecutive rate cuts imposed on them by authorities in recent months, and a shortage of capital that has become a common source of problem for many banks in recent years.

 

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f the decision made by the Cabinet to change Iran’s monetary unit is implemented, Iranian banknotes will also undergo changes, a deputy governor of the Central Bank of Iran said.

“If the decision is approved by the parliament, it is possible that minor changes will be considered when printing new banknotes at the beginning of the next year (in March),” Akbar Komijani was also quoted as saying by the official Telegram channel of CBI.

“It is possible to make changes to the new banknotes, but the public will be informed before any changes are made.”

In a move that will lop off one zero from the national currency, the government approved changing Iran’s monetary unit from rial to toman in the Cabinet’s latest meeting on Wednesday.

While rial (10 of which equal one toman) has been used as Iran’s monetary unit in official documents and budget statements, toman has long been used in daily transactions by citizens. The government will send the bill to the parliament for the final approval.

Under the proposed plan, 10 rials would equal one toman, reversing the initial conversion established in 1932.

 Komijani said replacing rial with toman does not equate a revaluation proper.

“Currently many studies are underway on revaluating and removing zeros from the national currency and while the matter has not been addressed in the Banking Reform Bill and the Central Bank Bill, it will be addressed in the future extensively in the form of a separate bill,” he said.

“That is because revaluation is a more encompassing endeavor and all monetary, economic and accounting factors must be considered in it.”

Noting that the central bank has done many studies on how to reform the monetary and banking regulations, the official pointed out that the bank is putting in finishing touches.

According to Komijani, work on honing the Banking Reform Bill and the Central Bank Bill has been completed and the bills have been presented to the government.

“Corrections will be made in the process of reviewing these two bills and the government will subsequently send them to the parliament,” he added.

The two bills have been crafted to upgrade and modernize banking regulations. Improving the independence of CBI, enhancing monetary policymaking and increasing CBI’s supervision over the money market are among their key goals.

  Commission: Drop More Zeroes

While the Cabinet has approved the removal of one zero from the national currency, the head of Majlis Economic Commission advocates dropping some more.

“Reducing the number of zeroes in the national currency will improve monetary transactions on the economic landscape and so we believe these decisions can have positive effects on the country’s economy,” Mohammad Reza Pour-Ebrahimi said in a phone interview with the state television.

With the replacement of banknotes, changes should also be made in the accounting system and the national treasury procedures.

Pour-Ebrahimi believes this process may take a year.

“The value of the currency will fare better if three to four zeroes are removed from the national currency instead of one,” he said.

There has been much talk about removing three or four zeros from the rial in the past few months, as experts stress that revaluation of the national currency could help boost its efficiency and ease daily transactions.

In fact, the cost of printing the new banknotes is expected to far outweigh its benefits, which makes the whole exercise doubtful.

  Inconsequential

However, not everyone takes a positive view of the Cabinet’s move, with the head of the Economics Department of Allameh Tabataba’i University in Tehran calling it inconsequential in Iran’s current economic climate.

“I am neither in favor nor against removing a zero and changing the national monetary unit, because I believe these two matters are completely irrelevant under the current economic circumstances,” Abbas Shakeri added.

“This is only a nominal action and will have no significant impact on the economy.”

CBI Governor Valiollah Seif also took to the instant messaging app Telegram on the day the plan was unveiled, saying it should not be considered as currency revaluation and it has only been taken up to “help ease money transactions for the public”.

“Currency revaluation has been fully studied by the Monetary and Banking Institute. We have identified all the prerequisites for implementing reforms in the national currency, stable single-digit inflation being one of them,” he said.

[screwball]

Currently many studies are underway on revaluating and removing zeros from the national currency and while the matter has not been addressed in the Banking Reform Bill and the Central Bank Bill, it will be addressed in the future extensively in the form of a separate bill,” he said.

While the Cabinet has approved the removal of one zero from the national currency, the head of Majlis Economic Commission advocates dropping some more.

[screwball]

“The value of the currency will fare better if three to four zeroes are removed from the national currency instead of one,” he said.

[screwball]

There has been much talk about removing three or four zeros from the rial in the past few months, as experts stress that revaluation of the national currency could help boost its efficiency and ease daily transactions.

In fact, the cost of printing the new banknotes is expected to far outweigh its benefits, which makes the whole exercise doubtful.

[screwball]

The government plans to get 275 trillion rials ($7 billion at market exchange rate) of the 3,711 trillion rials (about $95 billion) it needs for the next Iranian year's budget by selling bonds.

The new Iranian year starts March 20, 2017.

The administration of President Hassan Rouhani plans to issue 75 trillion rials ($1.9 billion) of Islamic Treasury Bonds and 200 trillion rials ($5.1 billion) in various sukuk, bonds compliant with Islamic contracts, to repay overdue debt to government contractors and finance its operations.

Surprisingly, the amount of treasury bonds the government wants to sell is the same as this year.

Borrowing through bonds is gaining popularity with the government. Though, due to the immaturity of Iran's bond markets, the government cannot rely heavily on borrowing, making petroleum sales and taxes in addition to borrowing from banks the main sources for government revenue.

President Rouhani submitted the budget bill for the next fiscal year to parliament on Sunday. The total budget is 10.6% over the 3,354-trillion-rial budget passed into law for the current year.

Also, government companies, banks and for profit organizations that had 6,828 trillion rials ($175 billion) of cash this year will get 7,565 trillion rials ($193.9 billion) of funds to finance their operations.

Islamic Treasury Bonds are underwritten and given to government contractors in lieu of overdue payments. After they open for secondary trading on Iran Fara Bourse, contractors can encash them by selling to a third party. They mature within a year.

ITBs are sold at a discount to their face value and bear no coupons, meaning they are traded at a lower price than their face value, but are redeemed at face value on maturity.

The Iranian government started giving bonds to contractors to revive industries that have frozen up because they are owed to by the government last September. The introduction of these bonds to Iranian markets was taken as a welcome sign in the development of money markets last year.

The bonds have had ample demand in a market where low risk securities are scarce.

Poor stock market performance and low business investment have ramped up demand for debt securities. Investors are looking for safe havens, after their hopes of swift economic recovery on the back of booming foreign investment was squashed by caution exercised by European lenders.

Major European banks remain reluctant to do business with Iran, even after sanctions against the country were removed. They are avoiding processing dollars for Iran for fear of prosecution by US authorities for breaking remaining sanctions against Tehran.

[screwball]

Czech National Bank sees no limitations for banking co-op with Iran

Tehran, Dec 9, IRNA – Governor of the Czech National Bank (CNB) Jiri Rusnok said on Friday that CNB sees no limitations for banking cooperation with Iran.

 

Speaking during a meeting in Prague with Iranian Minister of Economic Affairs and Finance Ali Tayyebnia, the CNB governor voiced support for the activities of Czech banks and companies in Iran. 

Tayyebnia has travelled to Prague to attend the 1st Iran-Czech Republic Joint Economic Commission session. 

During the meeting, the Iranian minister underlined the need for boosting banking brokerage ties between the two countries to facilitate Tehran-Prague economic cooperation. 

Figures released by the Czech Statistical Office suggests that Iran-Czech Republic economic relations rose up to $52 million in 2015, showing a 50% increase since a year ago. 
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[screwball]

Sweden welcomes opening of Iranian banks in Stockholm

News ID: 3845678 - Sat 10 December 2016 - 09:51

Economy

STOCKHOLM, Dec. 10 (MNA) – Presidential Chief of Staff Mohammad Nahavandian on Fri. met with Swedish ministers of trade and finance to discuss ways to further expand economic ties between the two countries.

In his meeting with Sweden's Minister of EU Affairs and Trade Ann Linde, Nahavandian stressed Iran’s plans for attracting the maximum volume of foreign investment, adding “Iran and Sweden can boost cooperation in various economic fields such as energy, rail transport, information technology and environment.”

He also highlighted the significance of facilitating banking transactions between the two countries, and suggested the opening of branches of Iranian banks in Stockholm which was received enthusiastically by the Swedish official.

Ann Linde expressed her country’s keen interest in expanding relations with the Islamic Republic in all areas, saying “developing economic cooperation with Iran is highly significant to us and we are deeply interested in finding solutions that would bring the two countries closer than before.”

The Swedish trade minister welcomed Nahavandian’s proposal on opening branches of a number of Iranian banks in her country, saying “Sweden has adopted a new policy for increasing its level of transactions with other countries, and in this regard, it fully welcomes Iran’s suggestions for further development of bilateral ties.”

Also on Friday, Nahavandian met with Swedish Minister for Finance Magdalena Andersson, where the two sides stressed the necessity of taking effective and practical measures in facilitating economic relations between the two countries.

“Many companies in Sweden are eager to develop ties with Iran and are pressuring the government into providing the necessary conditions for such transactions,” Andersson said, noting her country’s resolve for developing ties with Iran in both political and economic fields.

Welcoming the idea of having Iranian banks starting their activities in Sweden, she said “there are ample opportunities for investment and joint cooperation between the two sides that we are seriously considering. At the same time, we will also consider the Iranian side’s proposition for opening branches in Stockholm.”

Nahavandian also met with members of the International Council of Swedish Industry (NIR) where he called on Swedish companies to get more engaged with Iran’s private sector, and the Swedish officials discussed investment opportunities in Iran’s various industries.

MS/IRN82339409/82339431

[screwball]

Let's not forget this as I said until it passes the majlis and the rate changes we are still good to go!

Corrections will be made in the process of reviewing these two bills and the government will subsequently send them to the parliament,” he added.

[screwball]

Iran says it has signed contracts with South Korea’s shipyard Hyundai Heavy Industries Company to build at least eight Ultra Large Container Vessels (ULCVs) as well as medium-range tankers for carrying petroleum products.    

The contracts were the first of their kinds that Iran has signed after the removal of sanctions in January. They were sealed between Hyundai Heavy - the world’s biggest shipbuilder – and the Islamic Republic of Iran Shipping Lines (IRISL) – the biggest shipping company of the Middle East – at a total value of above $600 million.

Iran’s original order, as earlier reported by the Wall Street Journal, comprised four ULCVs and six containers.  The exact breakdown of the order is still not clear. 

The funding for the orders would be provided by South Korean banks and financial institutions, Iran’s IRNA news agency reported. 

The capacity of the container vessels will be 14,500 twenty-foot equivalent units (TEU) and the capacity of the tankers will be 49,000 deadweight tonnages (DWT).   

The move is expected to help speed up Iran’s overseas exports – particularly exports of crude oil as well as oil products – within the next few years. 

“The ULCVs that have been ordered to be built will be the first of a new generation of vessels that Iran will acquire,” the IRISL announced in a statement.  Hyundai Heavy is expected to start delivering the vessels from the second quarter of 2018, IRNA added. 

Discussions with the company over IRISL’s vessel orders had started last December. 

The contracts were parts of the IRISL’s plans to renovate its fleet through a total investment of $2.5 billion, the Wall Street Journal had earlier reported. 

The company operates about 115 oceangoing vessels, but many of the ships are old, have been deemed unsafe to travel and cannot be insured, it had added in its report. 

[screwball]

Banking obstacles major drawback in Pakistan-Iran trade: Envoy

Pakistan and Iran have tremendous potential to promote trade but the lack of payment mechanism through banking channels was the major hurdle in achieving the goal, said Iran's ambassador to Pakistan on Friday.

Mehdi Honardoust told the business community at Islamabad Chamber of Commerce and Industry (ICCI) that despite the preferential trade agreement between the two countries, Iran's trade with Afghanistan was five times more than that with Pakistan, reported nation.com.pk.

He said Iran's annual trade with Turkey and China stands at $20 billion and $50 billion respectively, whereas trade with Pakistan was negligible, which was unfortunate.

When informed that his country has imposed high tariffs on some Pakistani products, the ambassador said that a free trade agreement between the two countries would resolve all such problems.

He said Iranians preferred Pakistani products and underlined that Islamabad should step up efforts for early signing of FTA with Iran. He pointed out that Iran's biotechnology sector was better than those of many European countries. Pakistan's economy, he noted, could benefit by enhancing cooperation with Iran in biotechnology, pharmaceuticals, agriculture and other fields.

He said one Iranian company spent $1 million to supply electricity from Iran to Gwadar, but it did not receive an encouraging response from Pakistan. He assured that his embassy would fully cooperate with Pakistani business community in enhancing trade with Iran.

Meanwhile, ICCI President Khalid Iqbal Malik said that Iran maintained a permit system for imports and whenever it wanted to restrict import of certain items, it refused to issue import permits which was also hindering Pakistan's exports to Iran. He asked Iran to review its import permit system to help Pakistani exporters.

Iran could focus on frequent exchange of trade delegations and organizing reciprocal exhibitions to explore new avenues of promote trade, he said.

The official said Pakistan should import gas and electricity from Iran to overcome its energy crisis and facilitate growth in business and industrial activities.

[screwball]

Banks in Switzerland could seize the opportunity of playing a leading role in financing investment projects in Iran, President Hassan Rouhani’s chief of staff said in a meeting with members of Swiss Bankers Association on Thursday.

“Iranian bankers prepared a comprehensive guideline for enhancing the sector [even] before the lifting of sanctions. Iran’s economy is now more stable, which makes it a great opportunity for foreigners to start commercial cooperation,” Mohammad Nahavandian’s official website reported.

Herbert J. Scheidt, chairman of the association, said Iran has managed to take practical steps for enhancing its banking sector.  “We believe this is a valuable achievement,” he said. “On behalf of bankers, I express Swiss bankers’ keenness to cooperate with Iranian banks.”

Reyl Bank and BCP are among Swiss banks that have reportedly started working with Iran.

Back in May, Bank Pasargad Iran announced that it was seeking to launch a branch or a subsidiary in Switzerland. However, banking relations between the two countries have not fully normalized.

The Swiss government estimates that exports to Iran, valued at more than $620 million last year, could double or even triple within a decade.

[screwball]

590-member delegation from Russia to be in Tehran on Dec 11

Moscow, Dec 10, IRNA – Tehran will host Russia's 590-member economic delegation that is to fly to Iran on Sunday.

 

The visit will be a major step towards implementatation of the decision made by the presidents of the two countries to expand bilateral ties.

The delegation is headed by Russia's Minister of Energy Alexander Novak. 

The 13th Iran-Russia joint economic commission is to be held in the Iranian capital during the visit of the Russian delegation.

Iran's Minister of Communications and Information Technology Mahmoud Vaezi and the visiting Russian minister are to co-chair the Tehran economic commission meeting which is considered as an unprecedented measure towards fostering the two countries' relations.

The Russian delegation is scheduled to ink several agreements and hold bilateral meetings with the Iranian officials.

Coincident with the joint economic commission in Tehran, Iran-Russia energy commission will be held for the first time to review the ways to widen bilateral cooperation in that area.

Iran's ambassador to Moscow says Tehran-Moscow cooperation is witnessing a bright future.

According to reports, Iran and Russia have planned for a yearly four-billion-dollar of economic relations by the end of 2017.

According to the latest statistics, the worth of the two countries' economic exchanges grew by 80 percent in first half of 2016 compared with the same period last year. 
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[screwball]

Currency revaluation has been fully studied by the Monetary and Banking Institute. We have identified all the prerequisites for implementing reforms in the national currency, stable single-digit inflation being one of them,” he said.

 

and no comment on this or the previous posts about the zeros?

[pokerplayer]

1 hour ago, screwball said:

Currency revaluation has been fully studied by the Monetary and Banking Institute. We have identified all the prerequisites for implementing reforms in the national currency, stable single-digit inflation being one of them,” he said.

 

and no comment on this or the previous posts about the zeros?

Shock and Awe ! What else can I say ? I think I am going to like retired life being rich. 

pp

[gregp]

Thanks SB. I appreciate all your dedication to this thread. I have been really busy the last few weeks. Trying to catch up!  

[blueskyline]

Just waking up . Thank You Screwball and.........................................WOW !

[tigergorzow]

SB, Truly appreciate all the good news....Based on the many articles provided since lifting of sanctions numerous countries are diving in on the golden opportunities for investment & trade which equals billions of dollars for all parties.  Iran is definitely busy on all fronts and monetary reform is at the top of their agenda.  It seems that the Iran President is leading the charge for this major change while PM Abadi is keeping a low profile in regards to currency reform or he is working behind the scene with the CBI.  Only time will tell but I'm praying both Iran & Iraq will surprise us "Suddenly" with an increase in purchasing power for their citizens.  

Keeping the faith!!

 

GO RV!!

[screwball]

6 hours ago, tigergorzow said:

SB, Truly appreciate all the good news....Based on the many articles provided since lifting of sanctions numerous countries are diving in on the golden opportunities for investment & trade which equals billions of dollars for all parties.  Iran is definitely busy on all fronts and monetary reform is at the top of their agenda.  It seems that the Iran President is leading the charge for this major change while PM Abadi is keeping a low profile in regards to currency reform or he is working behind the scene with the CBI.  Only time will tell but I'm praying both Iran & Iraq will surprise us "Suddenly" with an increase in purchasing power for their citizens.  

Keeping the faith!!

 

GO RV!!

We have to keep the faith....all the way to the end!

[screwball]

Nobakht: Shifting in national currency serves to facilitate exchanges

Tabriz, East Azarbaijan prov, Dec 10, IRNA - Vice President and Head of Planning and Budget Organization Mohammad Baqer Nobakht said that shifting Iran's national currency from rial to toman serves the objective of facilitating economic and trade exchanges.

 

The Iranian government, in a session on December 7 approved parts of a bill proposed by Central Bank of Iran (CBI) to replace rial with the denomination of toman equivalent to 10 rials.

If approved by the Iranian Parliament (Majlis), the change will empower Iran's currency.

Devaluation of the national currency brought up the US dollar to 30,000 rials when the eight-year term of the former Iranian government came to an end in 2013.
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