BANKS

Iran 2017 | FINANCE | B2B

Though the government is making it easier for foreign firms to enter the market for the first time, domestic firms will continue to meet the vast majority of Iranians' banking needs for the time being.

Gholamhasan-Taghi Netaj
GHOLAMHASAN-TAGHI NETAJ
CEO
Ghavamin Bank
Abdolmajid Poursaied
ABDOLMAJID POURSAIED
CEO
Iran Zamin Bank

How do you contribute to the Iranian economy?

Gholamhasan-Taghi Netaj Ghavamin Bank is approaching its 20th anniversary and has 800 branches all over Iran. All our activities are within Iran and conducted in Iranian rials; we do not have any foreign currency exchange activities or international objectives. Ghavamin Bank mainly provides services to families and SMEs. We have 6 million customers and 8,000 employees. Our bank provides various types of banking services; we provide loans and other credit facilities and act as a depository. Some 6% of the cash that flows through the Iranian economy is related to Ghavamin Bank. In order to maintain market share it is important to reduce our costs. There is also a need to innovate through the development of electronic banking to attract more customers to our services. On a separate note, we do not have an exact figure for the number of SMEs operating in Iran or their total share in the economy. Ghavamin Bank has excellent information about marketing and, with our knowledge and branch network, we have great potential to attract investors and be their first choice when they look for a bank. We prefer to deal with SMEs rather than larger companies.

Abdolmajid Poursaied Iran Zamin Bank was established before the sanctions and focused on industry in general and the different industrial segments in particular. It has financed different industrial and cultural projects from well before the sanctions. We continued the provision of banking services during sanctions, and over the past two years we see more opportunities in different sectors for banks. We have tried to improve economically as well. Iran Zamin Bank is expanding its activities in creating jobs and also helping to improve the different sectors of the country. That is how the bank contributes its share toward developing the country.

What is your strategy for the immediate future?

GN Something particular in Iran is the current space between the true economy of Iran and its banking or monetary economy. Investors should take note of this gap. Iran's true economy, with all its activities, including production, agriculture, mining, and goods and services, accounts for 10%, while finance makes up 25% of the economy. It is important to not ignore this difference. I expect the government to be increasingly effective in meeting its goals in the upcoming four years. The gap between the real economy and the monetary one will reduce with an inflation rate of around 10%.

AP We have planned the international department since 2016. Now we are having meetings with the Central Bank of Iran to obtain permission and licenses. In the first year of its activity, we are looking to increase our volume. We want to capture a 5% share of international banking in Iran. After the permissions and licenses are obtained, we will look to expand our market share. Our plans have been carefully designed. We need huge investment and specialists in the sector, but are ready to create this situation. We will meet the requirements of the Central Bank of Iran and reach our goals. We might need some more time, although our shareholders are determined to succeed in a short period of time. What we took into consideration when designing our goal was the potential of our shareholders who are acting in different sectors, such as petrochemicals, industry, and oil and gas. We believe our target is practical. The only thing that can delay our success are the issues we need to resolve with the Central Bank. We cannot say exactly how international investors can benefit from having a presence in Iran, but Iran's economic situation and government plans are toward creating a good environment for foreign investors, as well as promoting international banks to begin operating in Iran. There is great potential in this sector of the country, and it is the government's policy to attract investors and focus on international relations.