Aiming To Integrate With Global Banking System

The Iranian banking system is waking up and evolving to be part of the global banking system post the lifting of the sanctions.

- Mohan

A recent World Bank report describes Iran as the second largest economy in the Middle East and North Africa (MENA) region after Saudi Arabia. It has an estimated GDP of US$412.2 billion in 2016. It also has the second largest population of the region after Egypt, with an estimated 78.8 million people in 2015. Iran’s economy depends on hydrocarbon, agriculture and services sectors, and a noticeable state presence in manufacturing and financial services. The report points out that the country has adopted a comprehensive strategy encompassing market-based reforms as reflected in the government’s 20-year vision document and the sixth five-year development plan for the 2016- 2021 period. The report also suggests that implementing a domestic reform agenda is likely to bring the highest growth dividend in the medium to long term.

In this background, the banking sector in the country is poised for reform and growth. Despite various international economic sanctions the country had faced, analysts feel the local banking system remains intact and displays potential for growth.

GOVT BANKS DOMINANT

Iran has 30 banks, 20 of them are in the private sector. There are 5 specialized government banks, 3 commercial government-owned banks and 2 Islamic non-profit granting funds. Besides, there are 5 financial/credit institutions.

The top Iranian banks are Bank Melli, Post Bank Iran, Bank Saderat Iran, Bank Sepah, Bank Pasargad, Bank of Industry and Mine, Export Development Bank of Iran, Bank Tejarat, Bank Mellat, Eghtesad Novin Bank and Karafarin Bank.