The majority of Iranian banks are now connected to Swift, the international interbank messaging network, and more than 300 correspondent relations have been established with international banks, director of the Central Bank of Iran’s department of international relations said Monday.
Negotiations over improving the interbank correspondent relations are still underway; “however, this is a lengthy process and requires a lot of time to be concluded,” Hussein Yaqoubi was quoted as saying by ILNA.
“For establishing correspondent relations, Iranian banks’ financial statements should first be evaluated by international banks willing to cooperate, which is time-consuming.”
According to Yaqoubi, correspondent relations have significantly improved during a three-months after the implementation of the Joint Comprehensive Plan of Action (JCPOA) on Jan 26, and Iran’s new investment opportunities, created by the lifting of the international sanctions. The nuclear deal also convinced some international lenders to start relations with Iranian banks for the first time.
It is reported that 29 of the major Iranian lenders are now successfully connected to SWIFT, but Bank Saderat, Mehr Eghtesad Bank and Ansar Bank are yet to be removed from the sanctions list.
Right after the implementation of the JCPOA, the list of Iranian banks removed from the sanctions list was published on the United States and European Union’s official treasury [AS1]websites.
Ramped Up Cooperation
Hamid Tehranfar, deputy governor of the Central Bank of Iran has said that Iranian banks have about 45 overseas branches which will soon resume operations following the end of the international restrictions.
Abbas Araghchi, deputy foreign minister for legal and international affairs and a senior nuclear negotiator, has also emphasized that “establishing correspondent relations depends largely on the Iranian banks’ efficiency in preparing the ground for robust international banking relations. He too confirmed that 300 correspondent relations are established between Iranian lenders and International banks.
Bank Melli, Bank Mellat and Bank Tejarat have established 20, 43 and 14 correspondent relations with international banks, respectively; in the aggregate, almost 2000 LCs have been by the three lenders in the past three months.
Creating a ‘competitive atmosphere’ crucial for international banking ties, improvement of banking infrastructure, reducing soured debts and non-performing loans and attracting foreign investment and technology are among the banks’ achievements during post-sanctions era.
In recent weeks some Iranian banks and their overseas branches have resumed operations in the wake of sanctions relief such as Bank Melli’s affiliate in Russia known as ‘Mir Business Bank’, Melli Bank London plc and its branch in Hong Kong as well as three branches of Bank Mellat in Turkey.
Other banks are in the process of launching new overseas offices. Bank Saman has an eye on neighboring Turkey while Bank Pasargad is holding talks for opening branches in Paris and Rome. Pasargad had announced earlier that it is also exploring the possibility of establishing a foothold in Germany, Spain, Turkey and China in the form of wholly-owned branches, joint ventures with local partners or outright acquisitions.
