Average Employee Loans in Some Iranian Banks Reached 847 Million Tomans

The website "Eco Iran" reported on banking reports regarding loans granted to bank employees, stating that the average loan provided to employees of the Industry and Mine Bank was approximately 847 million tomans per person. Mohsen Dehnavy, a member of parliament, also tweeted that the total loans paid to bank employees in the year 1400 (2021) amounted to over 146 trillion tomans, adding, "I wish they would be so generous to the youth and tenants as well." Accordingly, the average loan received by employees at the Post Bank of Iran was 651 million tomans, and at the Housing Bank, it was about 610 million tomans. Economic expert Reza Gholami also mentioned on his social media that in the last quarter of the year 1401 (2022), the Central Bank provided each of its employees with at least 1.3 billion tomans in interest-free loans with a repayment period of over 30 years. Recently, an economic review of the banking situation in Iran revealed that the "capital adequacy ratio" in 19 banks was below the "standard of 8 percent," and even in 10 banks, this ratio was negative. According to Basel Committee standards, the minimum capital adequacy ratio for banks and credit institutions is set at 12 percent. Nevertheless, the Central Bank of Iran has determined the minimum for the banking network in Iran to be 8 percent. The "capital adequacy ratio" indicates how much risk a bank can cover with its own capital; thus, the main function of this ratio is to protect the bank against unexpected losses and also to support depositors and creditors. In that report, the Industry and Mine Bank recorded the highest percentage of "doubtful loans" at 86 percent, which refers to loans that the bank has no hope of recovering. The report also addressed other issues and violations, such as 50 to 60 percent of bank loans being paid to themselves. Last summer (on August 30), the Islamic Consultative Assembly, during its review of the "Islamic Republic of Iran Banking Plan," designated the government institution "Central Bank" as responsible for establishing Islamic banking, while the head of the "Sharia Council of the Central Bank" also announced that "Sharia observers" would be stationed in banks. The Central Bank's mission to establish "Islamic banking" comes four decades after the revolution. Siamak Shojaei, an economist, stated that the establishment of "Islamic banking" will increase the control of the clergy over banks.