A week after the economy minister asked banks to abide by the CBI policy on deposit and lending rates, the governor of the Central Bank of Iran communicated the same to CEOs of banks.
In a meeting with banks, managers late Saturday, Abdolnasser Hemmati said they must uphold rules approved by the Money and Credit Council on interest rates or face penalties.
"The CBI supervision department needs to intensify monitoring and penalize banks that don’t comply," he was quoted as saying by the CBI public relations website.
Hemmati also asked banks to create “a balance” between their resources and spending when it comes to lending.
Last week, Economy Minister Farahad Dejpasand in a letter to 12 banks and credit institutions asked them to comply with interest rates announced by the MCC, the top banking and monetary policymaker.
Dejpasand warned them that they would be taxed proportional to interest on deposits paid over and above those announced by the MCC.
Last July the MCC slightly increased one-year maturity deposits by 1 percentage point to 16%. Likewise, interest on two-year deposits was set at 18%. On short-term deposits with 3-month maturity, the rate was increased by 2 percentage points to 12%. The main banking body approved 14% interest rate for six-month deposits, up 3 percentage points.
The warning came after reports that some banks were offering up to 21% interest on deposits, apparently in the attempt to lure customers, especially those with deep pockets.
The warning also reflects concerns about the potential impact of high interest rates on the share market. The CBI has been resisting demands for increasing interest rates due to its impact on investors’ willingness to invest in the stock market, which has been in dire straits for months.
