Iran has completed the merger of six lenders with major links to the military, a move designed to curb the security forces’ role in the economy and shore up the country’s financial industry.
The oldest and biggest of the banks, state-run Sepah Bank, will take over Ansar Bank, Mehr Eqtesad Bank, Hekmat Bank, Ghavamin Bank and the Kosar Credit Institution, the head of the Central Bank of Iran, Abdolnaser Hemmati, said in a statement posted on his Instagram account.
Plans for the merger were first announced in March 2019 as part of efforts to improve transparency and regulation and tackle a high ratio of bad loans, driven mainly by the proliferation of unlicensed creditors.
Iran’s Military Steps Back From Economy With Six-Way Bank Merger
With the economy under strain after the re-imposition of U.S. sanctions, the merger is a step forward for President Hassan Rouhani’s efforts to bring Iran’s banks in line with international standards and reduce the military’s footprint on the industry.
