Monthly interest payment by Iran’s banks positive for stock exchange
Tehran, Iran, Jan. 3
Iran’s Central Bank has announced recently that the interest payment on investment deposits should be changed from daily to monthly and banks will not be allowed to pay daily profits for short-term deposits.
Some analysts believe this policy, in addition to controlling the inflation, can solve the challenges of the banking system, including some banks’ misbehavior in paying too much interest to depositors, which in recent years was costly for banks.
“With this Central Bank policy, more money will flow to the capital market and more securities will be bought,” former managing director of Iran Fara Bourse (IFB), Mostafa Omid Ghaemi, told Trend.
“The monthly payment of interests to depositors will help boost the stock exchange,” Mostafa Omid Ghaemi said. “It seems we will experience a recovery in the stock market over the coming months.”
Pointing to the rise in foreign exchange rates over the past months, he says “We expect the stock market to flourish after the Iranian New Year [on March 21, 2019], because the rise in the exchange rates has made the 9-month and 12-month reports of the companies positive.”