Bank Muscat gets Iran approval

28 March 2016

Central Bank of Iran approves first Tehran office for Omani lender

Oman’s Bank Muscat has received permission from both the Central Bank of Oman and the Central Bank of Iran to establish a representative office in Tehran.

It is the first foreign bank to be issued a permit by the Central Bank of Iran since nuclear sanctions were lifted in January 2016.

State-owned Bank Muscat could not be reached for comment.

The Industrial Commercial Bank of China and several other foreign banks are still in the process of finalising permits, the Central Bank of Iran confirmed.

It would not comment on whether any European banks had begun the process.

Continuing US primary sanctions and ballistic missile sanctions have discouraged major global banks from doing any business with Iran.

The caution from major banks is preventing Iranian banks from carrying out foreign transaction and establishing correspondant banking relationships, despite their reconnection to the Society for Worldwide Interbank financial telecommunication (Swift).

“In Western countries and places which are under U.S. influence, our banking transactions and the repatriation of our funds from their banks face problems… because [banks] fear the Americans,” Supreme Leader Ayatollah Ali Khamenei said in a televised address marking the Iranian new year, according to Reuters.

US regulators imposed billions of dollars in fines on banks which violated primary sanctions before 2012.

Other GCC banks are also cautious with regard to Iran, due to political tension between Saudi Arabia and Iran. But Oman played an important role in brokering the nuclear deal between Iran and the P5 +1 countries (the US, China, France, Russia, and the United Kingdom, plus Germany). Muscat is encouraging investment deal between the two countries.

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