Iran: Small EU banks ready to work

Parviz Aghili, head of the private Middle East Bank in Tehran said a certain number of small European banks have agreed to work with the country multiple months after the removal of the sanctions.

He told AFP that the banks that are now preparing to work Iran are from Italy, Austria, Switzerland, Germany, Turkey and Belgium.

Aghili did not name the banks but AFP quoted a Tehran-based banking expert as saying that some of them include Raiffeisen Bank and Erste Bank from Austria, Mediobanca and Banco Popolare of Italy, Germany's EIH, KfW and AKA banks, Belgium's KBC, ING of the Netherlands and Turkey's Halk.

"These banks have established working relations with the Iranian banks to open letters of credit for fairly small sums of 10, 20 or 50 million dollars," said the expert who has not been named. 

But they lack the resources to finance big projects like the deal struck between Iran and European aircraft manufacturer Airbus for 118 airplanes, or oil and gas development projects, the expert said.

Aghili further emphasized that major Western banks are still reluctant to do business with the Islamic Republic for fear of US retribution.

SS