Economy, Business And Markets

Global Banking Snags Starting to Ease

Global Banking Snags Starting to EaseGlobal Banking Snags Starting to Ease

Foreign banks are slowly starting to reengage with Iran’s Middle East Bank after international sanctions were eased in January, although it will be months before all snags are resolved, the bank’s chief said on Wednesday.

“Slowly, slowly the situation is improving,” Parviz Aqili, CEO and managing director of the Tehran-based bank, told an Iran conference in London.

“It is going to take four to five months probably, until mid-summer, until all the difficulties have been resolved and we are in a position to deal with international banks.”

International sanctions, including banking restrictions, imposed against Iran ended in January under a deal with world powers in which Tehran agreed to curb its nuclear program, Reuters reported.

Last month, many Iranian banks linked up with global transaction network SWIFT, allowing them to resume cross-border transactions with foreign banks.

Middle East Bank, which is smaller than state-owned players such as Bank Melli and Bank Saderat, is owned by investors, including small and medium-sized Iranian firms.

Aqili said it had concluded a transaction via Switzerland involving banks there “without any problem”.

He added that Middle East Bank had set up banking relationships with 18 to 20 foreign institutions in recent weeks, including from Western Europe, in addition to the five to six that it had before sanctions were imposed.

“It was initially mainly smaller banks. Now, we are getting medium-sized banks and now a few sizable banks who have approached us. We are moving in the right direction,” he said.