Bank Melli Iran is not only the nation’s largest bank in terms of assets, it is also expanding its operations regionally with a variety of initiatives stretching from Afghanistan in the east to Iraq in the west and Dubai in the Gulf. Following the establishment earlier this year of Bahrain-based Future Bank, a joint venture with Iran’s Bank Saderat and Bahrain’s Ahli United Bank, Bank Melli hopes to set up a branch in Baghdad. According to Mr A Zafarani Hassan, a Bank Melli board member, a full licence to operate in Iraq has been granted in principle and this would help facilitate trade between the two countries.
Trade links
Bank Melli is also keen to put together a similar structure in Kabul, which would help facilitate trade between Iran and Afghanistan.
Mr Hassan also explains that Bank Melli plans to set up in Pakistan, Saudi Arabia and Kuwait in addition to its eight existing branches in the United Arab Emirates. Besides its representation in Europe and Hong Kong, Bank Melli has operations in Muscat in Oman and Baku in Azerbaijan.
A key part of Bank Melli’s regional expansion is through the Dubai International Financial Centre. Mr Hassan hopes to establish a Bank Melli branch in the centre as soon as possible. “Our focus is regional,” Mr Hassan says, stressing the importance of Dubai and also Turkey, where Bank Melli has three branches and key banking links. He adds that a branch in Athens is an integral part of Bank Melli’s regional network.
Bank Melli, in common with other Iranian banks, is expanding its offshore banking potential on Kish Island along with Qeshm. Future Bank is also planning to set up a branch on Kish to take advantage of the trading opportunities in the Gulf.
Capital is growing
Results for the end of 1382 (March 20 2004) show that Tier 1 capital rose to $884.5m, with total assets increasing to $26.93bn and net profit for the year hitting $815m.
As a key component of its strategy, Bank Melli undertook a series of steps to augment its customer value. To deliver on its public commitments, the bank expanded its automated services by developing the integrated banking system – known as “Siba” – which is now provided through 1273 branches in Iran.
Other major steps included setting up 1326 VSAT terminals, 481 automated teller machines and increasing the use of pinpad and point-of-sale units, particularly at shopping centres and other prime locations.
Credit dominance
In the previous year, Bank Melli operated 3061 branches in Iran and 17 offices and subsidiaries abroad, employing 41,102 staff in total. Bank Melli was the leading bank in terms of credit facilities, retaining a 32% share of the total lending market for commercial banks.
Compared with other banks, Bank Melli has been the largest provider of public services in such areas as the collection of water, electricity and telephone bills, traffic tickets, building construction levies, paycheques, money transfers, certified and interbank drafts.
