Gov’t Debts to Banking System Exceed $58b

In the month ending April 20, the government's debts to the banking system, including the Central Bank of Iran, commercial, specialized and private banks, exceeded 2.2 quadrillion rials ($58.3 billion), marking an increase of 21.3% year-on-year.

According to the latest statistics published on CBI's official website, the government's arrears to the banking system during the period also experienced a 2.5% growth compared to the previous month.

Government-affiliated companies and institutions only accounted for 14% of the arrears reaching 317.8 trillion rials ($8.36 billion) while the government itself is responsible for other debts that equal 1.9 quadrillion rials ($5 billion).

The lion's share of government's debts to the banking system, belonging to private banks and non-bank credit institutions, stands at 32%. Their arrears reached 734.6 trillion rials ($19.33 billion), which indicate an annual surge of 45.6%.

As cited in the report, CBI is the second major creditor of the government whereas its due until April 20 reached almost 600 trillion rials ($15.78 billion) which equals 26.6% of the entire government arrears, marking respective increases of 0.9% and 4.1% annually and monthly.

Specialized and commercial banks are respectively owed 477.3 trillion rials ($12.56 billion) and 440.5 trillion rials ($11.59 billion), accounting for 21.1% and 19.5% of government's debts to the banking system.

President Hassan Rouhani on January 2017 notified a measure approved by his ministers, which decrees that Management and Planning Organization "is authorized to allocate a maximum of 146.2 trillion rials ($3.78 billion) from the surplus assets of the Central Bank of Iran to clear the confirmed debt of the government to agent banks".

This is while the private sector's debts to Iran's banking system by the end of the first month of the new Iranian year to April 20 have also experienced an annual increase of 24.1% to reach 9.1 quadrillion rials ($239.4 billion), but the figure also shows a slight decline of 0.5% compared to its previous month.

Private banks and non-bank credit institutions are major creditors of the private sector. This is while the private sector's debts to private lenders until April 20 reached 5.6 quadrillion rials ($147.3 billion), registering an increase of 29.4% year-on-year.

By April 20, specialized and commercial banks were respectively owed 2.05 quadrillion rials ($65.7 billion) and 1.4 quadrillion rials ($36.84 billion), up by 12.1% and 22.9% compared with the corresponding period of last year.