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Mizan Lacks Funds to Repay All Clients

Mizan Lacks Funds to Repay All ClientsMizan Lacks Funds to Repay All Clients

The government and the central bank have “no obligations” to protect Mizan Credit Institution or its depositors, Central Bank of Iran Deputy Governor Akbar Komijani told Eghtesad News on Saturday.  “Mizan’s micro depositors will be reimbursed by the Institution’s available funds, but the rest of the depositors should go through the legal process to restore their investments,” said Komeijani. “The central bank has already warned the public about the risks involved in making investments in uncertified credit and financial institutions.” Clarifying the role of Bank Saderat in Mizan’s restructuring process, Komeijani said: “The bank will only act as an agent and will not spend any money from its own resources to reimburse Mizan’s depositors.” In early May, Mizan’s board of governors and executives were arrested by a court order for failing to reimburse their depositors. Since then, Bank Saderat has taken over the institution. However, the decision has been criticized by prominent economists arguing that “by forcing troubled credit institutions on banks, the central bank punishes the bank’s shareholders and rewards the wrongdoings of the owners of such institutions.”

Financialtribune.com