Two Iranian banks to launch presence in Russia: Iran's Central Bank

By Al Mayadeen English
Source: News websites
19 May 2023 08:55
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Iran's central bank says that there has been a push for Iranian banks to enter Russian markets amid growing economic ties between the two nations.

Russian President Vladimir Putin shakes hands with Iranian President Ebrahim Raisi during a meeting in Tehran, Iran July 19, 2022. (Reuters)

Two Iranian banks are set to enter the Russian market soon, marking the second landmark announcement this week toward integrating independent financial ties away from Western-dominant monetary systems, after Russia's second-largest bank VTB said on Wednesday it will be opening an office in Iran.

“Fortunately some good developments are taking place. We hope to announce news of the inauguration of the representative office and branch in Russia for at least two Iranian commercial banks in future,” said Mohsen Karimi, deputy governor for international affairs in Iran's Central Bank.

Russia's VTB bank- co-owned between the private and public sectors, but with majority shares held by the state - will allow Iranians, especially business owners and tradesmen, to obtain safe access to many financial systems in Africa, Latin America, Asia, and Europe where VTB and its subsidiaries are active.

It was the first Russian bank to officially establish a presence in Iran.

Commenting on the matter, Karimi said VTB’s decision aligns with the bank's policies to invest in opportunities in Iran's market.

In the past months, Iran's central bank has been pushing domestic banks to enter the Russian market to benefit from economic opportunities, Karimi added.

The head of Iran's central bank, Mohammadreza Farzin, announced earlier this year that Iran and Russia have established a direct link between their central banks.

In January, Farzin announced that Iran's banking system is reconnecting with the world economy, stating that so far direct connections with 106 foreign banks have been created.

The SEPAM and Russian SFPS electronic financial systems were linked earlier, both of which are an alternative to the Western-controlled SWIFT system.

More international organizations, such as BRICS and the Shanghai Cooperation Organisation (SCO), are in the process of establishing alternative trade systems and monetary bodies to ones dominated and influenced directly by the United States and Western countries, which have used sanctions to pressure nations that challenged Western influence.