Central Bank Governor Outlines Broader Financial Plans

TEHRAN (Iran News) Speaking to reporters on the sidelines of a ceremony marking the issuance of Murabaha sukuk by Mobarakeh Steel Company, Farzin said negotiations are scheduled with Omani central bank officials to introduce these Islamic financial instruments into their market.

Farzin emphasized that the Central Bank is focused on diversifying financial instruments to support both foreign currency and rial-based financing needs. He noted that while the CBI does not directly engage in currency operations, such activities have been delegated to Iran’s Currency and Gold Exchange Center.

“We have multiple projects requiring foreign currency funding, and our aim is to use diverse financial tools for this,” Farzin stated. “This includes launching pre-sale foreign exchange contracts and sukuk bonds.”

He explained that the sukuk initiative is part of a broader push to establish a forward currency market in Iran — a common practice globally. Though technical and infrastructure hurdles have delayed the rollout, Farzin said the plans are firmly underway.

Among the alternative methods being implemented is the pre-sale of foreign exchange, which allows for upfront financing and has already begun through the issuance of bonds for select projects. The aim is to raise up to $2 billion in foreign exchange sukuk this year, building on smaller efforts from the previous year, such as funding the Bidboland Refinery project.

Iran is also looking to collaborate with the National Development Fund and several domestic banks to facilitate bond issuance. Farzin believes these bonds could be attractive not only to the public but also to businesses, exporters, and importers.

Regarding Iran’s efforts to market these financial products abroad, Farzin revealed that talks have already commenced with Russian financial institutions to introduce Iranian sukuk in their markets. However, the first available bonds, such as those from Mobarakeh Steel, are currently accessible only within Iran.

Farzin added that nearly €1.86 billion in projects are slated to be financed through foreign exchange bonds.

He dismissed concerns that sanctions might interfere with profit payments or principal repayments to investors, stating, “Sanctions have not impacted our ability to repay. All bondholders have received payments on time, and we’ve sold bonds with a 6% return in just 48 hours.”

President Pezeshkian is expected to visit Oman next week, with Farzin scheduled to arrive a day earlier for preliminary discussions with Omani financial authorities. The talks will focus on finalizing the framework for offering Iranian sukuk in Omani markets.

Farzin also addressed the controversial case of Babak Zanjani, a businessman convicted of massive embezzlement. He confirmed that nickel reserves belonging to Zanjani are being held at the Central Bank’s vault, not at customs warehouses.

“These reserves were supposed to be sold by Mr. Zanjani to repay his debts to the Central Bank. We’re still waiting on that,” Farzin said, adding that the CBI has not assessed the true value of the nickel, nor verified its authenticity.

On Zanjani’s cryptocurrency assets, Farzin noted that any recovery or collection would depend on final rulings issued by the judiciary.

Farzin revealed plans to issue export credits for agricultural producers trading in the country’s “Commercial Forex Market.” This separate market aims to prevent agricultural exporters from competing with petrochemical firms, whose dominance often skews prices and access.

In response to questions on bank specialization, Farzin noted that charter reforms are underway as part of the Seventh Development Plan. Once implemented, banks will operate solely within their defined mandates — for example, marriage loans would only be processed by select specialized institutions.

Until then, all banks remain obligated to participate in mandatory lending programs such as marriage and childbirth support.

Mojtaba Zanganeh, Head of the National Development Fund, stated that the next planned bond issuance — in collaboration with Bank Tejarat — will raise up to $200 million for upstream oil sector projects.

He emphasized the urgency of investing in shared oil fields currently being tapped by neighboring countries, warning that delays would lead to the loss of national resources. “The upstream oil sector offers strong returns and can help stabilize broader energy imbalances, especially in natural gas,” Zanganeh said.