Iran merges banks to boost efficiency

The Central Bank of Iran (CBI) announced on Saturday that four banks and a credit institution will be merged into the country’s oldest bank as part of a plan to boost efficiency and “reform the banking system and the financial market.”

The CBI’S announcement did not give a date for the merger of Ansar and Mehr Eqtesad, affiliated with the Islamic Revolution Guards Corps, Ghavamin, affiliated with the police, Hekmat Iranian, affiliated with the army, and Kosar Credit Institute, affiliated with the Defense Ministry, with Bank Sepah, Iran’s oldest bank, which is now owned by the government.

The CBI said the merger, which would create “a stable and more efficient single bank”, is aimed at “concentrating the capabilities and capacities” of these institutions in order to “provide the armed forces personnel and the general public with better services.”

The CBI described the process as an “important step” towards preserving “the stability and health of the banking system” and urged cooperation for “the successful implantation” of the merger.

Bank Sepah, set up in 1925 by an army pension fund as Iran’s first bank, has 1,800 branches across the country and others in Britain, France, Germany and Italy.

The United States imposed sanctions on Bank Sepah in November, after it withdrew from Iran’s 2015 nuclear deal with world powers.

AP and Reuters contributed to this story.