- Central Bank of the Islamic Republic of Iran
The Central Bank of the Islamic Republic of Iran ( _fa. بانک مرکزی جمهوری اسلامی ايران, "Bank Markazi Jomhouri Islami Iran") is the
central bankof Iran.
Ilkhanatewere one of the rulers of Iran that tried to introduce paper currency in Iran in the late 13th century, without success. [ Patrick Clawson. "Eternal Iran". Palgrave. 2005. Coauthored with Michael Rubin. ISBN 1-4039-6276-6 p.168]
In modern banking, the British first opened the
Imperial Bank of Persiain 1889, with offices in all major cities of Persia and India. To compete with the British bank, Imperial Russiaalso opened the Russian Loan and Development Bank. [ Patrick Clawson. "Eternal Iran". Palgrave. 2005. Coauthored with Michael Rubin. ISBN 1-4039-6276-6 p.41]
The first state owned
Iranian bank, Bank Melli Iranwas established in 1927 by the government of Iran. [ Patrick Clawson. "Eternal Iran". Palgrave. 2005. Coauthored with Michael Rubin. ISBN 1-4039-6276-6 p.55] 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 33 years, Bank Melli Iranwas acting as the central bankof Iranwith the responsibility to maintain the value of Iranian Rial.
In August 1960, the
Iranian governmentestablished the Central Bank of Iran (CBI) and separated all central banking responsibilities from Bank Melli Iranand assigned it to the newly formed central bank[web cite|url=http://www.cbi.ir/section/AboutTheBank.aspx|title=About the Central Bank of Iran|publisher=The Central Bank of the Islamic Republic of Iran] .
The Central Bank of Iran was renamed to the
Central Bank of the Islamic Republic of Iranimmediately after the Islamic revolutionand the overthrow of the Shah of Iran. Scope and responsibilities of the Central Bank of the Islamic Republic of Iran (CBI) have been defined in the Monetary and Banking Law of Irancite web|url=http://www.cbi.ir/simplelist/1457.aspx|title=Monetary and Banking Law of Iran|publisher=Central Bank of the Islamic Republic of Iran]
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.
Governors of the Central Bank of Iran [ [http://www.cbi.ir/page/1570.aspx Governors ] ]
In a country where the government claims to follow the strict Islamic principles, running a traditional banking network would be against the fundamental teachings of
Qur’an. Therefore, immediately after the Islamic Revolution, the Central Bank was mandated to establish an Islamic banking law. In 1983 the Islamic Bankinglaw of Iranwas passed by the Islamic Majlis of Iran[cite web|url=http://www.cbi.ir/simplelist/1457.aspx|title=Iran's interest-free banking law|publisher=Central Bank of Iran] . According to this law, Iranianbanks can only engage in interest-free Islamic transactions ( interestis considered as usuryor ribaand is forbidden by Islamand the holy book of Qur’an). These are commercial transactions that involve exchange of goods and services in return for a share of the assumed "profit". All such transactions are performed through Islamic contracts, such as "Mozarebe", "Foroush Aghsati", "Joale", "Salaf", and "Gharzol-hassane". Details of these contracts and related practices are outlined in the Iranian Interest-Free banking law and its guidelines. This law describes and authorizes an Iranian Shiiteversion of Islamic commercial laws.
Critics believe that this law has simply created the context for legitimising
usuryor 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 collateralitems such as real estate, commercial paper, bank guarantees and machinery eliminate any risk of loss. In case of defaults or bankruptcies, the principle amount, the expected interest and the late fees are collected through possession and or sale of secured collaterals.
*Reserves of foreign exchange &
gold: US$40.06 billion (2005 est). :*Composition: In 2007, 10% of the Reserves were held in Gold, 20% in US dollars (down from 40% in 2006), the rest mostly in Euroand other major currencies (ie, Yen, British Poundand the Swiss Franc). :*Usage: Part of the reserves are held in the $12 billion (2006) Oil Stabilization Fund, designed for capital investmentor for budgetsupport if oil prices- Iran's main foreign exchangeearner - fall perilously low. [ [http://tehrantimes.com/Description.asp?Da=6/25/2007&Cat=9&Num=017 We welcome the euro, says Tehran] ]
* Iran's deposits in foreign banks stand at $35 billion while its obligations amount to $25 billion (2007). [ [http://www.presstv.com/Detail.aspx?id=59305§ionid=351020102 Press TV - Iran's foreign deposits stand at $35bn ] ]
Exchange rates: "rials per US dollar" - 9,326 (2007), 9,246 (2006), 8,964 (2005), 8,885 (2004), 8,193.89 (2003): "note: Iran has been using a managed floating exchange rate regime since unifying multiple exchange rates in March 2002.": "Pre-unification, rials per US dollar"::: "Market": 8,200 (2002), 8,050 (2001), 8,350 (2000) [ [http://www.farsinet.com/toman/exchange.html Iranian Currency Exchange Rate - Money Exchange in US, Europe & Canada - Iranian Currency Exchange Rate History, Iran Curency System, Iranian Currency History ] ] :: "Official": 6,906.96 (2002), 1,753.56 (2001), 1,764.43 (2000) [CIA factbook]
International Monetary Fundreports that in 2001, currencyand 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. [ [http://www.payvand.com/news/08/jul/1036.html Iran's inflation rate 21%, liquidity $174b, Central Bank says ] ]
lending rate: [ [http://www.economist.com/Countries/Iran/profile.cfm?folder=Profile%2DEconomic%20Data Economist.com | Country Briefings: Iran ] ] 12.0% (2007), 11.5% (2008), 11.0% (2009)
*According to Bank Markazi, rate of inflation as of April 2008 is 18.4% [cite web|url=http://www.bbc.co.uk/persian/iran/story/2008/04/080430_si-khamenei-economy.shtml|title=Iranian leader defends the president of the Islamic Republic of Iran|publisher=BBC] .
Inflation and Monetary Policy
Double digit inflation rates have been a fact of life in Iran for the past 20 years. Between 2002 and 2006, rate of inflation has been fluctuating between 12 and 16% [cite web|url=http://www.indexmundi.com/iran/inflation_rate_(consumer_prices).html|title=Iran Inflation Rate|publisher=index Mondi] .
Monetary policyin Iran has not been successful in meeting the inflationand monetary targetsset in the IranianFive-Year Development Plans, owing mainly to the monetary impact of governmentspending out of oil revenue. Although the attainment of the inflation targets has improvedsomewhat recently, the objective of a gradual disinflation to single-digit levels has not beenachieved. Moreover, the implicit intermediate target of monetary policy, money growth, hasbeen systematically missed [cite web|url=http://www.imf.org/external/pubs/ft/wp/2007/wp07119.pdf|title=Money and Inflation in the Islamic Republic of Iran|publisher=IMF] .
The Central Bank is an extension of the
Iranian governmentand as such it does not operate independently. Interest rateis usually set based on political priorities and not monetary targets. There is little alignment between fiscal and monetary policy.
Membership in International Organizations
*Iran is member of the
Islamic Development Bank.
*As of August 2006, the
World Bankhas financed 48 development projects in the country for a total original commitment of US$3,413 million. [ [http://web.worldbank.org/WBSITE/EXTERNAL/COUNTRIES/MENAEXT/IRANEXTN/0,,menuPK:312964~pagePK:141132~piPK:141121~theSitePK:312943,00.html World bank report on Iran] ]
Iranjoined the International Monetary Fund(IMF) on December 29, 1945 [web cite|url=http://www.imf.org/external/np/fin/tad/exfin2.aspx?memberKey1=450&date1key=2007-10-10|title=Iran's Financial Position at IMF|publisher=IMF] . CBI governors attend IMF's board discussions on Iranon behalf of the government. These meetings are usually held once a year in Washington D.C.[web cite|url=http://www.imf.org/external/country/IRN/index.htm|title=Iran and IMF|International Monetary Fund] .
*The Central Bank of Iran has an
observer statusat the annual meetings of the Bank for International Settlements(BIS) in Basel, Switzerland.
* Mirdamad Building - 144 Mirdamad Boulevard, Tehran, Iran [cite web|url=http://www.cbi.ir/page/Contact_en.aspx|title=Central Bank of Iran|publisher=Central Bank of Islamic Republic of Iran]
* Ferdowsi Building - Ferdowsi Ave, Tehran, Iran
* Jewelry Museum - Ferdowsi Ave, Tehran, Iran [cite web|url=http://www.allmuseums.com/javaherat_museums.html|title=Jewelry Museum|publisher=All Iranian Museums]
* [http://www.cbi.ir/default_en.aspx Official website]
* Swift Address: BMJIIRTH
* Postal address: 144 Mirdamad Boulevard, Tehran, Iran
List of banks in Iran
Iranian rial(Iran's currency)
Tehran Stock Exchange
Shetab Banking System
Labour and tax laws in Iran
*Economy of Iran
Privatization in Iran
Iranian oil bourse
Ministry of Petroleum of Iran
Imperial Bank of Persia
History of banking
List of central banks
* [http://iran-daily.com/1386/2860/html/focus.htm Islamic Banking — Iran Daily]
* [http://www.islamicbankinglaw.com Islamic Banking Law]
*fa icon en icon [http://www.cbi.ir/default_en.aspx Central Bank of the Islamic Republic of Iran official site] (including statistics about Iran's economy)
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