Euro­pean banks re­luc­tant to re­sume trans­ac­tions, says Iran

The Pak Banker - - FRONT PAGE -

TEHRAN: Iran com­plained on Satur­day that Euro­pean banks and com­pa­nies were too wary about re­new­ing busi­ness ties fol­low­ing the lift­ing of eco­nomic sanc­tions and said it had asked the In­ter­na­tional Mon­e­tary Fund (IMF) to ease their con­cerns. In Jan­uary, world pow­ers led by the United States and the Euro­pean Union lifted most sanc­tions on Iran in re­turn for curbs on its nu­clear pro­gram.

But some U.S. sanc­tions re­main, and U.S. banks re­main pro­hib­ited from do­ing busi­ness with Iran di­rectly or in­di­rectly be­cause Wash­ing­ton still ac­cuses Iran of "sup­port­ing ter­ror­ism". That has de­terred Euro­pean in­sti­tu­tions, which fear they could face U.S. le­gal prob­lems if they re-es­tab­lish bank­ing links.

"There is still ' Ira­nopho­bia' in the bank­ing sec­tor that we're try­ing to over­come," Hamid Tehran­far, a vice gov­er­nor of Iran's cen­tral bank, was quoted as say­ing by state news agency IRNA.

"We have asked the In­ter­na­tional Mon­e­tary Fund to re­view our reg­u­la­tions so other coun­tries' banks feel re­as­sured. The IMF will an­nounce its as­sess­ment in 2018," he added, with­out ex­plain­ing why it would take two years.

As part of sanc­tions re­lief, most of Iran's banks were re­con­nected to the SWIFT in­ter­na­tional pay­ments net­work last month, al­low­ing them to re­sume cross-bor­der trans­ac­tions with for­eign banks. But be­cause of for­eign in­sti­tu­tions' le­gal fears, ac­tual ac­tiv­ity has re­mained very lim­ited.

Alex Thursby, chief ex­ec­u­tive of Na­tional Bank of Abu Dhabi, the emi­rate's big­gest bank, said this week that in re­al­ity, no banks could con­duct trans­ac­tions with Iran in U.S. dol­lars un­der cur­rent con­di­tions. That is a political as well as an eco­nomic headache for the ad­min­is­tra­tion of Pres­i­dent Has­san Rouhani, since his con­ser­va­tive par­lia­men­tary crit­ics have com­plained the nu­clear deal is not de­liv­er­ing the ex­pected ben­e­fits to Iran. Deputy for­eign min­is­ter Ma­jid Takhter­a­vanchi, a ne­go­tia­tor of the nu­clear deal, also crit­i­cized the "cau­tious be­hav­ior" of Euro­pean banks in re­sum­ing trans­ac­tions with Iran.

Newspapers in English

Newspapers from Pakistan

© PressReader. All rights reserved.