Economy, Business And Markets

CBI, Italy’s SACE Sign €6B Deal

CBI, Italy’s SACE Sign €6B DealCBI, Italy’s SACE Sign €6B Deal

In the presence of the President Hassan Rouhani, and Italian Premier Matteo Renzi, SACE and the Central Bank of Iran signed a settlement agreement for the recovery of the sovereign credit due to SACE by Iranian counterparties.

The agreement provides for the payment to SACE of €564 million in three installments by 15 October 2016. The credit represents claims paid by SACE to Italian companies for loans unpaid by Iranian counterparties following curbs on the payment systems imposed by international sanctions.

The agreement was reached a few days after the 'Implementation Day' at the highest professional level and will enable SACE to reactivate its support to Italian exports and investments in Iran, enabling companies to seize opportunities in lucrative sectors such as oil & gas, petrochemicals, automotive and construction, the CBI website reported on Thursday.   

SACE, the Italian export credit agency has raised the ceiling of credit allocated to Iran to over € 6 billion and will open a branch office in Tehran to extend financial and insurance services to Iranian businesses, Valiolah Seif, the CBI governor said.

The deal came as part of the two-day state visit by Rouhani and a high-profile delegation, including Seif, to Rome this week.

In addition, the two sides signed an agreement for SACE to extend insurance coverage to Iran's designated projects. The insurer also undertook to raise Iran's credit rating through negotiations with relevant European authorities.

>> Meetings With Top Bankers

Seif held talks with his Italian counterpart, Ignazio Visco. He briefed the senior Italian banker on  measures taken by the CBI to prepare Iran's banking sector for the resumption of ties with their foreign peers and called on the regulator in Rome to help Iran meet all the existing international supervisory standards.

He considered the "quick recovery of mutual ties" as a major prerequisite for implementing economic and business deals signed between the two countries. The Italian governor said he would encourage Italian banks to closely interact with their Iranian counterparts.

Providing technical aid and training to the CBI in the areas of supervision,  foreign currency  management, supporting the reopening of Bank Sepah in Rome and expediting the review of applications by Iranian banks to open branches in Italy  were among other issues agreed between the two sides.

Seif also met with the CEO of the Italian lender, Mediobanca, which is said to be one of the largest banks in the world with a wide international network.

During the meeting, the two sides discussed the possibility of Mediobanca's presence and investment in Iran, offering banking services by the Italian lender and utilizing its global network, particularly in southeast Asia and Europe to facilitate Iran's correspondent banking relations in the two regions.  

In a separate meeting with the managing director of UBAE bank of Italy, the CBI chief addressed the issue of the bank's unsettled assets with UBAE and possible solutions. The two sides also discussed resumption of ties upon the resolution of financial issues between the two banks.