Economy, Business And Markets

Majlis to Study Revised Version of Bank Reform Bill

Majlis to Study Revised Version of Bank Reform Bill  Majlis to Study Revised Version of Bank Reform Bill

A revised version of the Banking Reform Bill will soon be sent to the parliament by the central bank, according to Ali Divandari, head of Monetary and Banking Research Institute.

In an interview with Mehr News Agency, Divandari said, “With the new parliament in session (as of Saturday), an improved version of the Banking Reform Bill will be presented to the Majlis for approval.”

He said in the new version added attention has been paid to the promotion of Islamic finance. “In this bill prominence has been given to the expectations of the people and the banking industry from usury-free banking.”

The much-debated bill was taken up in the dying days of the previous parliament but faced strong opposition from the government, the central bank and representatives of the private sector on grounds that it would further complicate matters in the already beleaguered banking sector.

Lawmakers finally backed down and left the bill to be discussed by the new legislature that came to office at the weekend and is expected to be more cooperative with the Rouhani administration whose tenure ends next year.

A draft version of the proposed reform bill was sent to the lawmaking body in mid-April, though it was supposed to come into effect during the previous administration whose tenure ended in 2013. Among other things, the bill proposed founding a body at the CBI to supervise its compliance with Sharia-based regulations.

The body would comprise the governor of the Central Bank of Iran, his deputy for supervisory affairs, five Muslim theologians with expertise in banking and monetary issues and one legal expert.

Divandari acknowledged that the current usury-free banking law is not comprehensive, stressing however that the root of the problem goes back to implementation not to the shortcomings of the law itself.

“If the current law was implemented correctly, we would not be dealing with many of the problems we have today,” he said, without specifying the problems.

The last reforms to the Usury-Free Banking Law and the Banking Law were made in 1983 and 1972 respectively. The laws itself specify that reviews are needed every five years.

But despite this, the law has not undergone any major modification in the last three decades.