|Ownership||State ownership 1|
|Central bank of||Iran|
|Currency|| Iranian rial |
IRR (ISO 4217)
|Reserves||$130 billion (2017)|
|Reserve requirements||10% to 13%|
|Interest paid on excess reserves?||Yes|
Standard tableau of Central Bank of Iran
|Formed||9 August 1960|
|Jurisdiction||Islamic Republic of Iran|
|Headquarters|| CBI Tower, Tehran |
|1 According to article 10(e) of the Monetary and Banking Act of (1972), CBI's capital "is fully paid up and wholly owned by the Government".|
2 Bank Melli Iran had supervisory functions and regulated the activities of all banks in Iran, while being the largest profit-making commercial bank in the country.
The Central Bank Iran (CBI), also known as Bank Markazi, officially the Central Bank of the Islamic Republic of Iran (Persian : بانک مرکزی جمهوری اسلامی ايران, romanized: Bank Markazi-ye Jomhuri-ye Eslāmi-ye Irān; SWIFT Code: BMJIIRTH) is the central bank of Iran.
Persian, also known by its endonym Farsi, is a Western Iranian language belonging to the Iranian branch of the Indo-Iranian subdivision of the Indo-European languages. It is a pluricentric language predominantly spoken and used officially within Iran, Afghanistan and Tajikistan in three mutually intelligible standard varieties, namely Iranian Persian, Dari Persian and Tajiki Persian. It is also spoken natively in the Tajik variety by a significant population within Uzbekistan, as well as within other regions with a Persianate history in the cultural sphere of Greater Iran. It is written officially within Iran and Afghanistan in the Persian alphabet, a derivation of the Arabic script, and within Tajikistan in the Tajik alphabet, a derivation of Cyrillic.
Romanization of Persian or Latinization of Persian is the representation of the Persian language with the Latin script. Several different romanization schemes exist, each with its own set of rules driven by its own set of ideological goals.
ISO 9362 defines a standard format of Business Identifier Codes approved by the International Organization for Standardization (ISO). It is a unique identification code for both financial and non-financial institutions. The acronym SWIFT stands for the Society for Worldwide Interbank Financial Telecommunication. The ISO has designated SWIFT as the BIC registration authority. When assigned to a non-financial institution, the code may also be known as a Business Entity Identifier or BEI. These codes are used when transferring money between banks, particularly for international wire transfers, and also for the exchange of other messages between banks. The codes can sometimes be found on account statements.
Established under the Iranian Banking and Monetary Act in 1960, it serves as the banker to the Iranian government and has the exclusive right of issuing banknote and coinage. CBI is tasked with maintaining the value of Iranian rial and supervision of banks and credit institutions. It acts as custodian of the National Jewels, as well as foreign exchange and gold reserves of Iran.It is also a founding member of the Asian Clearing Union, controls gold and capital flows overseas, represents Iran in the International Monetary Fund (IMF) and internationally concludes payment agreements between Iran and other countries.
The Iranian rial is the currency of Iran.
The Asian Clearing Union (ACU), with headquarters in Tehran, Iran, was established on December 9, 1974, at the initiative of the United Nations Economic and Social Commission for Asia and the Pacific (ESCAP). The primary objective of ACU, at the time of its establishment, was to secure regional co-operation as regards the settlement of eligible monetary transactions among the members of the Union to provide a system for clearing payments among the member countries on a multilateral basis.
The International Monetary Fund (IMF), also known as the Fund, is an international organization headquartered in Washington, D.C., consisting of 189 countries working to foster global monetary cooperation, secure financial stability, facilitate international trade, promote high employment and sustainable economic growth, and reduce poverty around the world. Formed in 1944 at the Bretton Woods Conference primarily by the ideas of Harry Dexter White and John Maynard Keynes, it came into formal existence in 1945 with 29 member countries and the goal of reconstructing the international payment system. It now plays a central role in the management of balance of payments difficulties and international financial crises. Countries contribute funds to a pool through a quota system from which countries experiencing balance of payments problems can borrow money. As of 2016, the fund had SDR477 billion.
The first attempt at introducing paper currency in Iran occurred during the Mongol Ilkhanate of the 13th century CE. The innovation, developed in Song Dynasty China, did not take hold in Iran, and paper currency did not return to Iran in any significant manner for several centuries.
The Mongols are a Mongolic ethnic group native to Mongolia and to China's Inner Mongolia Autonomous Region. They also live as minorities in other regions of China, as well as in Russia. Mongolian people belonging to the Buryat and Kalmyk subgroups live predominantly in the Russian federal subjects of Buryatia and Kalmykia.
The Ilkhanate, also spelled Il-khanate, was established as a khanate that formed the southwestern sector of the Mongol Empire, ruled by the Mongol House of Hulagu. It was founded in the 13th century and was based primarily in Iran as well as neighboring territories, such as present-day Azerbaijan and the central and eastern parts of present-day Turkey. The Ilkhanate was originally based on the campaigns of Genghis Khan in the Khwarazmian Empire in 1219–1224 and was founded by Hulagu Khan, son of Tolui and grandson of Genghis Khan. With the fragmentation of the Mongol Empire after 1259 it became a functionally separate khanate. At its greatest extent, the state expanded into territories that today comprise most of Iran, Iraq, Armenia, Azerbaijan, Georgia, Turkmenistan, Turkey, western Afghanistan, and the Northwestern edge of the Indian subcontinent. Later Ilkhanate rulers, beginning with Ghazan in 1295, converted to Islam.
China, officially the People's Republic of China (PRC), is a country in East Asia and the world's most populous country, with a population of around 1.404 billion. Covering approximately 9,600,000 square kilometers (3,700,000 sq mi), it is the fourth largest country by total area. Governed by the Communist Party of China, the state exercises jurisdiction over 22 provinces, five autonomous regions, four direct-controlled municipalities, and the special administrative regions of Hong Kong and Macau.
In 1889, the British-owned Imperial Bank of Persia (Bānk-e Šāhī) was founded and it was given the exclusive right to issue bank notes in Iran. In 1890 it introduced the first bank notes in Iran, ranging from 1 to 1,000 tomans.The bank did not do much to strengthen the Iranian capital formation or support then-currency of Iran, qiran.
The Imperial Bank of Persia was a British bank that operated as the state bank and bank of issue in Iran between 1889 and 1929. It was established in 1885 with a concession from the Persian government to Baron Julius De Reuter a German–Jewish banker and businessman who later became a Christian and a British subject.
The Iranian Toman is a superunit of the official currency of Iran, the rial. Although the rial is the official currency of Iran, in everyday life Iranians employ the monetary unit 'toman', which is equivalent to 10 rials.
Capital formation is a concept used in macroeconomics, national accounts and financial economics. Occasionally it is also used in corporate accounts. It can be defined in three ways:
To compete with the British bank, Imperial Russia also opened the Russian Loan and Development Bank. [ unreliable source ]Polyakov's Bank Esteqrazi was bought in 1898 by the Tzarist government of Russia, and later passed into the hands of the Iranian government by a contract in 1920.
Lazar Solomonovich Polyakov was a Russian-Jewish entrepreneur. Polyakov founded his first bank in 1872 and by the 1890s owned an influential financial group; he was informally named "Rothschild of Moscow". His business collapsed in the early 1900s and was completely disbanded by 1909.
The first state-owned Iranian bank, Bank Melli Iran was established in 1927 by the government of Iran.On 30 May 1930, it took the responsibility to function as Iran's central bank, and took the rights of the Imperial Bank for £200,000, while it acted as a commercial bank at the same time. The bank's primary objective was to facilitate government's financial transactions and to print and distribute the Iranian currency (rial and toman). For more than three decades, Bank Melli Iran acted as the central bank of Iran and was charged with the responsibility to maintain the value of Iranian rial. In 1955, the bank was given the responsibility to supervise the national banking system.
Bank Melli Iran is the first national and commercial retail bank of Iran. It is considered as the largest Iranian company in terms of annual income with a revenue of 364 657 billion Rials in 2016. It is the largest bank in the Islamic world and in the Middle East. By the end of 2016, BMI had a net asset of $76.6 billion and a vast network of 3.328 banking branches; so it is known as the largest Iranian bank based on the amount of assets. The brand of BMI was recognized as one of the 100 top Iranian brands in 10th National Iranian Heroes Championship in 2013. The National Bank has 3328 active branches inside, 14 active branches and 4 sub-stations abroad and it has 180 booths. The first managing director of BMI was Kurt Lindenblatt from Germany. Also, the first foreign branch of BMI was opened in Hamburg, Germany in 1948.
The pound sterling, commonly known as the pound and less commonly referred to as sterling, is the official currency of the United Kingdom, Jersey, Guernsey, the Isle of Man, South Georgia and the South Sandwich Islands, the British Antarctic Territory, and Tristan da Cunha. It is subdivided into 100 pence. A number of nations that do not use sterling also have currencies called the pound.
In August 1960, the Iranian government established the Central Bank of Iran (CBI) and separated all central banking responsibilities from Bank Melli Iran and assigned it to the newly-formed central bank.Scope and responsibilities of the Central Bank of the Islamic Republic of Iran (CBI) have been defined in the Monetary and Banking Law of Iran (1960).
The Central Bank of Iran was renamed to "the Central Bank of the Islamic Republic of Iran", and Iran's banking system adhered to the new Islamic rules that prohibit earning or paying interest in 1983.
CBI maintains a museum of historic and ancient jewelry owned and used by the ex-kings of Persia. This museum houses the Imperial Crown Jewels and is one of the most appealing tourist attractions in Iran.
The Money and Credit Council (MCC) is the highest banking policy-making body of Bank Markazi. Its permanent members include the CBI Governor, the Finance and Economy Minister, two Ministers chosen by the Cabinet, The Head of the Chamber of Commerce, the General Prosecutor and two lawmakers (MPs).
Each year, after approval of the government's annual budget, the CBI presents a detailed monetary and credit policy to the MCC for approval. Thereafter, major elements of these policies are incorporated in the five-year economic development plan.MCC meets every three months.
In practice, the ability of the banking system to create money is not much constrained by the amount of scriptural money through fractional reserve banking. Indeed, most banks first extend credit and look for reserves later.The Iranian Central Bank needs more independence from the government in order to combat inflation, according to the country's Parliament Research Center. As of 2010, Iran's Central Bank, is not able to conduct a "proactive" monetary policy (e.g. it needs Majlis' approval before issuing participation bonds) and has no control over the government's fiscal policy.
The current combination of the Central Bank's board of directors are the President, Economy and Commerce Ministers, Deputy-President for strategic planning, and a Minister selected by the Cabinet.
Seven economists with at least 15 years of work experience were to become members of the general assembly according to a new law proposed by the Majlis in 2010, thus moving this body from being state-dominated to one where the private sector has greater say in the decision making process. Tenure of each member would be for 10 years and only for one term.Then President Mahmoud Ahmadinejad critiqued this proposal and said that it is important for the Central Bank of Iran not to fall under private control "because it would not benefit the Iranian people" over the long run.
The President of Iran proposes a person as the governor of CBI, who must be verified by the general assembly and appointed as per a presidential decree.
The objectives of the Central Bank of the Islamic Republic of Iran as per its charter and according to section 10 of the Monetary and Banking Law of Iran (MBAI) are as follows:
To achieve the objectives as stated in the MBAI, CBI is endowed with the responsibility of fulfilling the following functions:
After the Islamic Revolution, the Central Bank was mandated to establish an Islamic banking law. In 1983 the Islamic Banking law of Iran was passed by Majlis .This law describes and authorizes an Iranian Shiite version of Islamic commercial laws (as differentiated from a less 'liberal' Sunni version). According to this law, Iranian banks can only engage in interest-free Islamic transactions (as interest is considered usury or "riba" and is forbidden by Islam and the holy book of Qur’an). These are commercial transactions that involve exchange of goods and services in return for a share of the "provisional profit" called Mobadala.
In practice, Iran uses what are officially termed "provisional" interest rates, as rates paid to depositors or received from borrowers should reflect the profits or losses of a business.Under these rules, deposit rates, known as "dividends", are in theory related to a bank's profitability. In reality, however, these dividends have become fixed rates of return—depositors have never lost their savings because of losses made by the banks and almost never received returns larger than the provisional ex-ante profit rates. Interest charged on loans is presented as "fees" or a share of corporate profits. All such transactions are performed through (12) Islamic contracts, such as Mozarebe, Foroush Aghsati, Joalah, Salaf, and Gharzolhasaneh. Details of these contracts and related practices are outlined in the Iranian Interest-Free banking law and its guidelines. Examples are:
Shariah-compliant assets has reached about $400 billion throughout the world, according to Standard & Poor’s Ratings Services, and the potential market is $4 trillion.Iran, Saudi Arabia and Malaysia are at the top with the biggest sharia-compliant assets.
According to the IMF, Islamic banking forbids pure monetary speculation and stresses that deals should be based on real economic activity and therefore poses less risk than conventional banking to the stability of financial systems.
Critics believe that the Iranian Interest-Free banking law has simply created the context for legitimizing usury or riba. In reality all banks are charging their borrowers a fixed pre-set amount at a rate of interest that is approved by the Central Bank at least once a year. No goods or services are exchanged as part of these contracts and banks rarely assume any Commercial Risk. High value collateral items such as real estate, commercial paper, bank guarantees and machinery eliminate any risk of loss. In case of defaults or bankruptcies, the principal amount, the expected interest and the late fees are collected through possession and or sale of secured collaterals.
In 2005, the government obliged the Central Bank of Iran and the Iranian banks, mostly state owned, to set up all the necessary infrastructures (regulatory, hardware, software) for fully launching e-money in Iran by March 2005. While this plan has not yet fully materialized, local debit cards are now commonplace and have removed the main obstacle to the growth of e-commerce (in the national scale) as well as the full roll out of e-government initiatives.However, Iran remains largely a cash-based economy.
The Central Bank has developed the Real Time Gross Settlement System (SATNA) as the main center for settlement of Iranian banks' transactions in rial. Upon implementation of the first and second phases of this system in 2006/07, real time settlement through the interbank information transfer network (Shetab Banking System) and interbank clearing house was started in the review year. Since 2007/08, bank-to-bank and customer-to-customer payments were also settled through SATNA. The Retail Funds Transfer System (SAHAB), launched at end-2006/07 for real time transfer of a large volume of payments of relatively small value, was further developed in 2007/08. Moreover, there are further plans to connect Iran's Shetab to information transfer networks of other countries.
In 2011, two new payment systems were launched: Scripless Securities Settlement System (TABA) as the electronic infrastructure for placement and settlement of various securities, including governmental and CBI participation papers. The launching of the automated clearing house system (PAYA) for processing individual and multiple payment orders, connection of Iran's Interbank Information Transfer Network (Shetab) to other ATM and POS switch systems for the acceptance of international bank cards, designing of the electronic card payment system (SHAPARAK) for the centralization and reorganization of POSs.
According to the Ministry of ICT in 2018, Post Bank of Iran will issue Iran's first digital currency over the blockchain technology (with the advantage, in relation to the sanctions against Iran that blockchain transactions do not need any clearing bank).
Furthermore, given Iran's large reserves of oil and gas, the Iranian rial could become a reserve currency if parity is established with oil and gas,as was between USD and gold in the past (e.g. parity of 1,000,000 tomans for a barrel of oil), such as with Venezuela's newly minted "Petro" crypto-currency.
Finnotech.ir is Iran's premier banking API provider and Informatics Services Corporation (ISC) is a leading operator of information systems for the banking industry (including Shetab).As of 2016, Iran had 50 companies active in fintech. Speaking of fintechs' role in Iran's financial sector, the CBI allows them to operate as long as they are not involved in money creation, currency exchange, offering payment tools (like cards) and attracting deposits.
As of January 21, 2010, account holders will no longer be allowed to withdraw more than $15,000 from Iranian banks but they can still write checks for larger amounts. The government wants people to use bank checks and electronic banking systems instead of cash transactions.In 2009, 10.7% of cheques bounced.
In 2007, Tetra-Tech IT Company announced that Visa and MasterCard can be used for online sales and in Iranian e-card terminals at shopping malls, hotels, restaurants, and travel agencies for Iranians and foreign tourists.Iran's electronic commerce will reach 10 trillion rials ($1 billion) by March 2009. Some wealthier people have debit cards, but there is no MasterCard or Visa in Iran and few foreign banks are active there because of international sanctions. Around 94% of Iranians had a debit card, compared with less than 20% in Egypt (2015). In 2016, Iran introduced its own domestic credit card system based on Sukuk principles and reported talks with MasterCard (and other international payment operators) for a re-entry.
Many Iranian businesses and individuals also rely on hawala, an informal trust-based money transfer system that exists in the Middle East and other Muslim countries. Since the imposition of recent U.S. and UN financial sanctions on Iran, the use of hawala by Iranians has reportedly increased.
The Central Bank of Iran is enforcing the newly-passed Anti-Money Laundering law to curb possible crime. The minister of intelligence, the governor of the Central Bank of Iran (CBI) and several other ministers are among the members of the special committee in charge of the campaign against money laundering. In 2008, the Paris-based Financial Action Task Force (FATF) Watchdog praised the Islamic Republic's crackdown on money laundering. The 34-member financial watchdog congratulated Tehran on its commitment to seal money laundering loopholes.However, in 2010, FATF, named Ecuador and Iran on a list of states that it says are failing to comply with international regulations against money laundering and financing terrorism. Despite president Hassan Rouhani showing interest in FATF, there has been a massive disagreements by hardliners related to supreme leader, Ali Khamenei. Among them Ahmad Jannati, the chairman of the Assembly of Experts and the secretary of the Guardian Council and Ali Akbar Velayati, Iran's former foreign secretary and Supreme leader top foreign relationship advisor are two notable people who are against the FATF. These disagreements and lack of FATF being approved by the Iranian parliament has brought FATF enforcement to halt.
It has been estimated by the government of Iran in 2015 that dirty money from drug trafficking in Iran amounts to 10 trillion tomans a year (1 toman equals 10 rials), some of which has been finding its way into "elections and the securing of votes" to influence the country's politics.
In October 2010, Iran's gold reserves hit "record high" as the Central Bank took "preventive measures" to avoid a possible asset freeze by Western countries.In 2009, when the gold price was on average $656 per ounce, a "few hundred tons" of gold were imported, IRNA quoted CBI Governor Mahmoud Bahmani. "At present, the price of each ounce of gold is $1,230. Consequently, the value of the national reserves has risen by a few billion dollars" he said. Iran has changed 15% of its foreign exchange reserves into gold as the number is 1.7% for countries such as India and China (see also: U.S. sanctions against Iran.)
In January 2012, the head of Tehran's Chamber of Commerce reported that Iran had 907 tons of gold, purchased at an average of $600 per ounce and worth $54 billion at today's price.The CBI governor however reports only 500 tons (i.e. above ground gold reserves). The discrepancy is unexplained but the 907 tons could (mistakenly) include below-ground gold reserves (320 metric tons as of 2012) and possibly the gold in Iranian private hands (~100 tons in coins or bullion). In 2014, reports from the Central Bank put its gold stores at 90 tons only, the rest possibly used in barter trade following sanctions.
Double digit inflation rates have been a fact of life in Iran for the past 20 years. Between 2002 and 2006, the rate of inflation in Iran has been fluctuating between 12 and 16%.
Monetary policy in Iran has not been successful in meeting the inflation and monetary targets set in the Iranian Five-Year Development Plans, owing mainly to the monetary impact of government spending out of oil revenue. Although the attainment of the inflation targets has improved somewhat recently, the objective of a gradual disinflation to single-digit levels has not been achieved. Moreover, the implicit intermediate target of monetary policy, money growth, has been systematically missed.
The Central Bank is an extension of the Iranian government and as such it does not operate independently. Interest rate is usually set based on political priorities and not monetary targets. There is little alignment between fiscal and monetary policy.
The Central Bank assesses the inflation rate with the use of the prices of 395 goods and services in Iran's urban areas.
High levels of inflation have also been associated with a growth in Iran's money supply. The Central Bank's data suggest that the money supply growth has been about 40% annually. The rapid growth of money supply came from high demands for borrowing capital at the rate of 12% the banks offer, imposed by the Government to make credit accessible to average Iranians and small entrepreneurs. However, this rate is lower than the rate of inflation. This makes the cost of borrowing less than free market cost as determined by supply and demand, based on the inflation rate and investment risk.
This section needs to be updated.December 2018)(
|Source: International Monetary Fund (In billions of rials; unless otherwise indicated)||Prel. 2008/09||Proj. 2009/10|
|Net foreign assets (NFA)||703,329||789,498|
|In millions of U.S. dollars||72,381||77,050|
|In millions of U.S. dollars||79,587||84,257|
|-Foreign liabilities 1/||70,023||73,839|
|In millions of U.S. dollars||7,206||7,206|
|Net domestic assets (NDA)||-139,843||-225,654|
|Net domestic credit||-5,141||21,083|
|-Central government, net||-283,735||-228,046|
|-Claims on banks||239,758||206,409|
|-Claims on non financial public enterprises (NFPEs)||38,836||42,719|
|-Other items net, excluding central bank participation papers (CPPs)||-134,701||-246,737|
|-Currency in circulation||157,764||153,478|
|-Cash in vaults||48,588||47,268|
|Deposits of NFPE and municipalities||16,078||17,734|
|-Foreign currency deposits of NFPEs and municipalities||6,561||6,919|
End-period change (in percent of base money)
|-NDA (net of other liabilities)||32.0||-15.5|
This section needs expansion. You can help by adding to it.(December 2018)
The International Monetary Fund reports that in 2001, currency and demand deposits—an aggregate commonly known as M1—were equal to $71.7 billion. In that same year, M2—an aggregate equal to M1 plus savings deposits, small time deposits, and money market mutual funds—was $153.6 billion. According to the CBI, the country's liquidity amounted to some $174 billion by April 2008,$197 billion by October 2009. and over $300 billion in 2011. Estimates put the amount of capital floating in Iran's market at $254 billion in 2012.
Iran is member of the Islamic Development Bank. As of August 2006, the World Bank has financed 48 development projects in the country for a total original commitment of US$3,413 million.World Bank loans to Iran come only from the International Bank for Reconstruction and Development (IBRD). Iran is a member of the World Bank's Multilateral Investment Guarantee Agency. Iran joined the International Monetary Fund (IMF) on December 29, 1945. CBI governors attend IMF's board discussions on Iran on behalf of the government. These meetings are usually held once a year in Washington, D.C.. The Central Bank of Iran has an observer status at the annual meetings of the Bank for International Settlements (BIS) in Basel, Switzerland.
The US Treasury Department has also stepped up its attempt to restrict financing of foreign investment and trade with Iran. In January 2006, Swiss banks UBS and Credit Suisse announced separately that they were halting operations in Iran. In September 2006 the Treasury Department banned all dealings by Bank Saderat Iran with the US financial system, and in January 2007 it also blacklisted Bank Sepah and its British subsidiary, Bank Sepah International. In October 2007 the US Treasury blacklisted Bank Melli and Bank Mellat.
Under pressure from the US, 12 Chinese banks have reduced ties with Iranian banks since early September 2007, but five of them resumed commercial ties in mid-January 2008. In mid-February 2008, the US Treasury alleged that Iran's Central Bank helped the blacklisted banks evade US sanctions, by conducting transactions for them.
The Central Bank possesses limited foreign cash reserves due to the international sanctions and problems in the transfer of funds in and out of country. In 2012, The U.S. unilaterally expanded sanctions, which cut off from the US financial system foreign firms that do business with the central bank.Iran is reportedly making increasing use of barter trade, cash smuggling, gold and local currencies of its trading partners to circumvent the international sanctions. The CBI has been blacklisted by the U.S. government due to the bank's involvement in the Iranian nuclear program and it has been blocked from using SWIFT since March 2012 as a consequence.
The Central Bank of Iran publishes a variety of periodicals for general and specialist audiences including Economic Trends, Bulletin, Annual Review, Economic Report and Balance Sheet. Other publications include booklets, monographs and brochures. Many of those documents are also available in English.
A central bank, reserve bank, or monetary authority is an institution that manages the currency, money supply, and interest rates of a state or formal monetary union, and oversees their commercial banking system. In contrast to a commercial bank, a central bank possesses a monopoly on increasing the monetary base in the state, and also generally controls the printing/coining of the national currency, which serves as the state's legal tender. A central bank also acts as a lender of last resort to the banking sector during times of financial crisis. Most central banks also have supervisory and regulatory powers to ensure the solvency of member institutions, to prevent bank runs, and to discourage reckless or fraudulent behavior by member banks.
The politics of Iran take place in a framework that officially combines elements of theocracy and presidential democracy. The December 1979 constitution, and its 1989 amendment, define the political, economic, and social order of the Islamic Republic of Iran, declaring that Shia Islam of the Twelver school of thought is Iran's official religion.
The economy of Iran is a mixed and transition economy with a large public sector. It is the world's eighteenth largest by purchasing power parity (PPP). Some 60% of the economy is centrally planned. It is dominated by oil and gas production, although over 40 industries are directly involved in the Tehran Stock Exchange, one of the best performing exchanges in the world over the past decade. With 10% of the world's proven oil reserves and 15% of its gas reserves, Iran is considered an "energy superpower."
Seigniorage, also spelled seignorage or seigneurage, is the difference between the value of money and the cost to produce and distribute it. The term can be applied in two ways:
The money supply is the total value of money available in an economy at a specific time. There are several ways to define "money", but standard measures usually include currency in circulation and demand deposits.
Currency substitution or dollarization is the use of a foreign currency in parallel to or instead of the domestic currency.
Monetary reform is any movement or theory that proposes a system of supplying money and financing the economy that is different from the current system.
Monetary policy is the process by which the monetary authority of a country, typically the central bank or currency board, controls either the cost of very short-term borrowing or the money supply, often targeting inflation or the interest rate to ensure price stability and general trust in the currency.
An open market operation (OMO) is an activity by a central bank to give liquidity in its currency to a bank or a group of banks. The central bank can either buy or sell government bonds in the open market or, in what is now mostly the preferred solution, enter into a repo or secured lending transaction with a commercial bank: the central bank gives the money as a deposit for a defined period and synchronously takes an eligible asset as collateral. A central bank uses OMO as the primary means of implementing monetary policy. The usual aim of open market operations is—aside from supplying commercial banks with liquidity and sometimes taking surplus liquidity from commercial banks—to manipulate the short-term interest rate and the supply of base money in an economy, and thus indirectly control the total money supply, in effect expanding money or contracting the money supply. This involves meeting the demand of base money at the target interest rate by buying and selling government securities, or other financial instruments. Monetary targets, such as inflation, interest rates, or exchange rates, are used to guide this implementation.
Foreign-exchange reserves is money or other assets held by a central bank or other monetary authority so that it can pay its liabilities if needed, such as the currency issued by the central bank, as well as the various bank reserves deposited with the central bank by the government and other financial institutions. Reserves are held in one or more reserve currencies, mostly the United States dollar and to a lesser extent the Euro.
The Central Bank of Iraq (CBI) is the central bank of Iraq.
The Tehran Stock Exchange (TSE) is Iran's largest stock exchange, which first opened in 1967. The TSE is based in Tehran. As of May 2012, 339 companies with a combined market capitalization of US$104.21 billion were listed on TSE. TSE, which is a founding member of the Federation of Euro-Asian Stock Exchanges, has been one of the world's best performing stock exchanges in the years 2002 through 2013. TSE is an emerging or "frontier" market.
The Bank of Albania is the central bank of Albania. The Bank of Albania has considerably evolved since being established, in contour with economic, political, and social developments. The main headquarters of the bank is in Tirana. The bank also has five other branches located in Shkodër, Elbasan, Gjirokastër, Korçë, and Lushnjë.
Following the Iranian Revolution, Iran's banking system was transformed to be run on an Islamic interest-free basis. As of 2010 there were seven large government-run commercial banks. As of March 2014, Iran's banking assets made up over a third of the estimated total of Islamic banking assets globally. They totaled 17,344 trillion rials, or US$523 billion at the free market exchange rate, using central bank data, according to Reuters.
Currency intervention, also known as foreign exchange market intervention or currency manipulation, is a monetary policy operation. It occurs when a government or central bank buys or sells foreign currency in exchange for their own domestic currency, generally with the intention of influencing the exchange rate and trade policy.
The first sanctions against Iran were those imposed by the United States in November 1979 after a group of radical students seized the American Embassy in Tehran and took hostage the people inside. The sanctions by Executive Order 12170 included freezing about $12 billion in Iranian assets, including bank deposits, gold and other properties, and a trade embargo. These sanctions were lifted as part of the Algiers Accords which was a negotiated settlement of the hostages’ release.
The Iranian targeted subsidy plan, also known as the subsidy reform plan, was passed by the Iranian Parliament on January 5, 2010. The government has described the subsidy plan as the "biggest surgery" to the nation's economy in half a century and "one of the most important undertakings in Iran's recent economic history". The goal of the subsidy reform plan is to replace subsidies on food and energy with targeted social assistance, in accordance with a Five Year Economic Development Plan and a move towards free market prices in a 5-year period. The subsidy reform plan is the most important part of a broader Iranian economic reform plan.
Iran Mercantile Exchange (IME) is a commodities exchange located in Tehran, Iran. It was founded in 2006. IME trades in agricultural, industrial and petrochemical products in the spot and futures markets. It is mainly a domestic or regional market with the ambition to become more international in the future. As of 2014, about one fourth of IME's commodities were exported. IME offers a variety of services, including providing access to the initial offering of commodities, pricing for Iran’s Over-the-Counter (OTC), secondary markets and end users, providing a venue for government sales and procurement purchases, facilitating a trading platform and user interface, providing clearing & settlement services, risk management, technology services, and training of market participants.
The National Development Fund of Iran (NDFI) is Iran's sovereign wealth fund. It was founded in 2011 to supplement the Oil Stabilization Fund. NDFI is independent of the government's budget. Based on Article 84 of the Fifth Five-year Socio-Economic Development Plan (2010–2015), the National Development Fund was established to transform oil and gas revenues to productive investment for future generation. It is a member of the International Forum of Sovereign Wealth Funds and therefore is signed up to the Santiago Principles on best practice in managing sovereign wealth funds. Withdrawing any money from this fund requires Supreme Leader's permission.
|Bank of issue of Iran|
Bank Melli Iran
| Central Bank of Iran|