The government sold 23.2 trillion rials ($100 million) in Islamic bonds in the interbank and stock market in the weekly CBI auction.
The auctions are held to raise funds for government spending amid deep decline in national revenue and the perennial budget deficits.
According to the Central Bank of Iran public relations office, bidders were two banks who put in bids worth 4.4 trillion rials ($19 million). The Economy Ministry accepted bids worth 1.9 trillion rials ($8m).
Retail and institutional investors in equity market bought the remaining 21.3 trillion rials ($92m) outside of the auction.
The CBI said it will hold the next auction on Sept 8 and offer 60 trillion rials ($260m).
Regarding 14 rounds of auctions, the CBI said Thursday it has so far generated 613 trillion rials ($2.6b) from selling Islamic bonds.
In previous auctions banks were the main buyers, but the last one showed a significant decline in their role.
Apart from banks, investment funds, insurance companies, government creditors and contractors of development projects are the main bond buyers.
Last week the CBI said the lion’s share of bonds are bought by banks, accounting for 69% of the total. Investors in the stock market bought 27% and the reaming were bought by investment funds.
The government has said it will carry on with the bond sales throughout the fiscal year to balance its budget. It plans to issue bonds worth 1,240 trillion rials ($5.4b) – a figure beyond forecasted in the March 2020-21 budget, according to Mehdi Banani, head of the Debt Management Department of the Economy Ministry.
Banani said the government needs to sell 940 trillion rials ($4.2b) in bonds during the first half the fiscal year, 620 trillion rials ($2.7b) of which is above the figure projected in the national budget.
He predicted that the government will need to sell another 620 trillion rials before the current fiscal year is out to cover deficit spending needs, ISNA reported. Almost 750 trillion rials ($3.2b) of government revenue from bond sales has been realized so far.
