Law on interest-free banking 39 years without amendment
Former Governor of the Central Bank: The rules and regulations in the banking system have not been implemented properly, the supervision department of banks should be changed and adapted to the current conditions.
According to the International Iranian Stone Exhibition, Mahmoud Bahmani regarding the reform of the country's banking system said: The law on interest-free banking operations was drafted in 1983 and the necessary amendments were to be made every five years in this sector, but unfortunately it has been nearly 39 years. No amendment has been made to this law.
He continued: "The independence of the central bank is one of the issues that should be considered and reformed, because the central bank should act independently and not be influenced by various factors and also subject to the government."
The former governor of the Central Bank said: the supervision department of banks should also be changed and adapted to the current conditions.
Bahmani pointed out that the government should have held an expert discussion in this regard and submitted a bill to the parliament regarding the reform of the banking system, adding: "Unfortunately, the government did not take action in this regard and the parliament began to work expertly to reform the banking system."
Regarding the problems of bank lending, he said: "We do not face any particular problem in the lending sector, but the lack of supervision of banks has caused the facilities provided to the production and industry to enter such sectors as intermediation and brokerage instead of entering these sectors."
The former governor of the Central Bank added: "We must provide most of the facilities to the production sector in a controlled manner and with close supervision, and unfortunately, the most important problem in banks is this regulatory issue."
In response to the question why banks get involved in corporate affairs themselves, Bahmani said: "In many cases, the government gives the companies under its supervision to the banks to pay its debts to the banks, and this causes the banks to enter into corporate governance."
He added: "In some cases, factories and companies that have received facilities are not able to pay their debts, in which case the banks have to manage the factory and a company to receive their debts."
The former governor of the Central Bank said: "Banks should not be allowed to participate, but the government should not transfer its demand to banks in the form of government shares."
Bahmani pointed out: Due to the lack of supervision of banks in providing facilities to the production sector, this sector has not been supported as it should be.
