| National Bank of Iran | |
| Type: | State-owned enterprise |
| Key People: | Abolfazl Najjarzadeh |
| Industry: | Banking, financial services |
| Products: | Consumer banking, corporate banking, finance and insurance, investment banking, mortgage loans, wealth management, credit cards, |
| Area Served: | Worldwide |
| Location: | Ferdowsi Street, Tehran, Iran |
| Revenue: | US$10.510 billion (2015)[1] |
| Num Employees: | 39,305[2] |
Bank Melli Iran (BMI; Persian: بانک ملی ایران|lit=National Bank of Iran|translit=Bânk-e Melli-ye Irân) is the first national and commercial retail bank of Iran. It was considered as the largest Iranian company in terms of annual income with a revenue of 364 657 billion Rials in 2016.[3] It is the largest bank in the Islamic world and in the Middle East. By the end of 2016, BMI had a net asset of $76.6 billion and a network of 3.328 banking branches; so it was known as the largest Iranian bank based on the amount of assets. The brand of BMI was recognized as one of the 100 top Iranian brands in 10th National Iranian Heroes Championship in 2013.[4] The National Bank has 3328 active branches inside, 14 active branches and 4 sub-stations abroad, and it has 180 booths.[5] The first managing director of BMI was from Germany, the first foreign branch of BMI was opened in Hamburg, Germany in 1948.
The formation of a new bank was first proposed by Haj Mohammad Hassan Amin Dar al-Zarb known as Amināl-Zarb (one of the Tehran stockholders) in 1879 ten years before the creation of the King Bank, to Naser-al-Din Shah Qajar.[6] But this proposal was not accepted with the interference of the countries that dominated Iran and their agents. Instead, the King Bank was established in Iran. After the establishment of the constitution, when the government allowed the National Assembly to allow external borrowing, the national feelings were excited that had been hurt by past loans and the behavior of foreign banks. So, the deputies demanded the establishment of the National Bank in order to curtail the political and economic influence of said banks and restore the treasury finances while opposing external borrowing.[7] A group of traders and merchants committed to participate in the bank. Thus, it was published with a statement that showed the general feelings and popular interest in establishing a national credit bank in Iran in December 1906.[8]
On 23 November 1906, Mirza Abolqasem Nasser al-Malik, the Minister of Finance of the time of Muzaffar al-Din Shah, was present in the National Assembly. He announced the financial crisis of the country. He suggested that the government get a loan from European countries to deal with this problem, but the deputies dissented strongly. After that, on 9 December, the deputies agreed to establish a bank that could benefit the country and work with people's deposits in the interests of the country and the people.
On the other hand, sudden changes in the political situation and the 1907 agreement between the governments of Russia and Britain and the division of Iran, as well as the beginning of the First World War and the arrival of occupation forces in Iran, have undermined all efforts to form the National Bank.[9] Finally, by the end of First World War and withdrawal of invaders from Iran, the law for establishing the National Bank of Iran was approved by the parliament on 14 May 1927. The statute of bank was approved by the Parliament's Finance Committee on 14 July 1928.
The first CEO of the National Bank,, and his vice-president, Fogel, came to Iran with 70 experts from Germany.According to the statute of bank, the National Bank of Iran was recognized as joint-stock company with legal personality; it was considered to be subject to commercial laws. The initial capital of the bank was 20 million Rials, of which only 8 million were paid. At present, it is 187 trillion Rials with an increase in 2016.
Due to the fact that there were no bank specialists in Iran at that time, the law allowed the recruitment of Swiss or German nationals for the administration of the bank. The number of bank employees on the opening day, including Iranian and German, did not exceed 27. Now, the number of employees of BMI is over 45 thousand people.
Initially, when the bank was first chartered, in addition to the central branch, two additional domestic branches were also opened, one in the market of Tehran and the other in Bandar-e Bushhehr, the country's most important commercial port. The bank's first official overseas branch abroad opened in 1948 in Hamburg, West Germany.[10] On 22 March 1931, the right to publish the banknote was approved by the National Assembly. It was officially granted to the National Bank of Iran for 10 years, which could be renewed on its own. In April 1932, the first banknote of BMI was issued.
Saving Fund: saving fund of Bank Melli Iran was established under a law to encourage people to save money in 1939.
After the Islamic Revolution, changes to the banking system were implemented in order to conform with Sharia law in the realm of Islamic banking and finance. The new law was passed in 1984. There are more than 3328 active branches inside, 14 active branches and 4 subsidiaries abroad and 180 offices.
The 20 Rials Pahlavi coin had two pictures: On one side, there was image of Reza Pahlavi with the words of Reza Shah: Establishment of BMI was one of the long-term wishes of my nation, and on the other side was the image of Mohammad Reza Pahlavi with the written: Establishment of BMI was one of the real foundations of independence of Iran.
(Source:[12])
The Museum of BMI was opened with the presence of Eshaq Jahangiri, the first vice president, on 21 July 2017. The Museum of BMI was opened with a collection of exquisite works of art, especially banking treasures from various historical periods of Iran, at savings fund building. The National Bank of Iran has ancient objects from Achaemenid, Sasanian and artistic works, including paintings, lines, rugs and blankets. So, the objectives of establishing BMI Museum is displaying old and historical banking instruments, as well as gifts from various countries during the activity of BMI. The building of BMI Fund was constructed at Ferdowsi Street in Tehran in 1928; it was registered in the category of national works of Iran on 20 December 2000 by number of 2930. This building was designed by a German architect H. Heinrich, inspired by remained Achaemenid periodic buildings and combination of Iranian and European architecture. In this museum, a comprehensive collection of historical gifts of the bank, office equipment and banknote printing machine, ancient paintings, coins, old banknotes and ceremonial bank items are publicly displayed.[13]
On 22 March 1931, the National Assembly handed over the right to BMI to print the banknote for 10 years. Also, it was decided that, after expiration of this period, if this right was not canceled, it would act for next ten years.
The first National Banknotes were issued on 1 April 1932. The banknotes of Imperial Bank and National Bank of Iran were prevalent from that date to three months. The banknotes of BMI have become the only paper money in Iran since July of that year.
By 1960, BMI was issuing banknotes for its economic needs. However, that year, upon establishment of Central Bank of Iran, the exclusive right to issue banknotes was transferred to this bank, which is still ongoing.
From the beginning of establishment, BMI was a public company; its initial capital was 20 million Rials divided to 20 thousand shares of thousand Rials (13,500 shares with name and 6,500 anonymous shares). But, the transfer of bank shares to non-state shareholders was banned in 1938. In 1935, the capital of BMI increased to 300 million Rials and increased to 2 billion Rials in 1952.
Due to banking system constraints, the National Bank carried out all duties of Central Bank in the economy before 1956. After establishment of Central Bank of Iran, the duties were assigned to this bank. The last registered capital of National Bank was 198 thousand and 565 billion and 600 million Rials in June 2017.[14]
See also: Banking and Insurance in Iran. All banks in Iran must follow the banking principles and practices described in the Islamic Banking (Sharia) law of Iran passed in 1983 by the Islamic Majlis of Iran.[20] According to this law, banks can only engage in interest-free Islamic transactions (interest is considered as usury or riba and is forbidden by Islam and its holy book the Quran). The permitted commercial transactions involve exchange of goods and services in return for a share of the assumed profit. All such transactions are performed through Islamic contracts, such as mozarebe, foroush aghsati, joale, salaf, and gharzol-hassane. Details of these contracts and related practices are contained in the Iranian Interest-Free banking law and its guidelines.
Serving condition table of BMI employees by gender[21]
| status | female | male | total | |
| Employed | 3,263 | 36,042 | 39,305 | |
| Employment status, 105 is disabled | 0 | 460 | 460 | |
| Martyr (employed: 9, retired: 50) | 2 | 57 | 59 | |
| retired prematurely | 616 | 3,402 | 4,018 | |
| Other retirees | 1,618 | 14,505 | 16,123 | |
| Dead (salaried: 7536) | 67 | 5,146 | 5,213 | |
| total | 5,566 | 59,612 | 65,178 |
The Hospital of BMI was established to provide health care and to meet the medical needs of its employees in 1938. Following this, the current building of the Bank Hospital was built in 1973.
16 June 2008 (US$1 is approximately 133,130 Iranian rial (Rls)):[22]
Mohammad Reza Hosseinzadeh, director of BMI, announced that the Islamic Republic of Iran owes over 220,000 billion Rials to BMI.[25] In 2009, the announcement of Mahmoud Reza Khavari's talks with ISNA news agency was published on the debt of 50 trillion Rials of Iranian government to the bank and the government's inability to repay the debt. But then, the news of "the government's inability to pay the debt" was denied by Khavari[26]
Bank Melli Iran has 18 international branches and services in 11 countries:
Afghanistan (Kabul)
Azerbaijan (Baku)
Bahrain (Manama)
France (Paris)
Germany (Hamburg)
Hong Kong (Hong Kong)
Iraq (Baghdad & Basra)
Oman (Muscat)Following the September 1997 suicide bombing in Jerusalem, five American students who had been wounded were awarded $251 million in compensatory and punitive damages against the government of Iran and the Iranian Revolutionary Guard Corps by Judge Ricardo M. Urbina, under the Flatow Amendment of the Foreign Sovereign Immunities Act, in accordance with Section 201a of the Terrorism Risk Insurance Act of 2002, which states that "in every case in which a person has obtained a judgment against a terrorist party on a claim based upon an act of terrorism ... the blocked assets of that terrorist party ... shall be subject to execution". Since most Iranian assets in the United States had been withdrawn after the embassy hostage crisis, the only substantial monetary asset left was approximately $150,000 in the Bank Melli's account in the Bank of New York. Before turning over the funds to the five students, however, the Bank of New York sued for a legal decision regarding its responsibilities in the case. The United States Department of Justice, speaking as amicus curiae in support of Bank Melli, advised that the bank had no responsibility for turning the funds over to the students; in March 2006, Judge Denise Cole ruled against them, and was upheld by the Second Circuit Court in April 2007. Bank Melli then withdrew the funds from Bank of New York.[27]
On 5 March 2018, Bank Melli lost an appeal "related to credit card use in Iran" concerning "roughly $17.6 million that Visa Inc and Franklin Resources Inc" were holding for Bank Melli.[28]
On 25 October 2007, the United States imposed unilateral sanctions against Iran. These sanctions include new measures to reduce Iran's ability to conduct financial transactions between the state-owned banks of Iran and United States citizens or private organisations.[29] Bank Melli was included in these sanctions, on the grounds that, besides its other customers, Bank Melli provides financial services to Iran's nuclear and ballistic missile programmes. A fact sheet released by the US Treasury Department also asserts that between 2002 and 2006 Bank Melli sent at least $100 million to Hamas, Palestinian Islamic Jihad, Hezbollah and other groups, via the Quds Force, a branch of the Iranian Revolutionary Guard.
In a statement published on its website, BMI refuted the US allegations and denied that it has ever been involved in any "deceptive banking practices".[30]
On 16 June 2008, the European Union imposed further unilateral sanctions against Iran. These sanctions include the European Union freezing the assets of Bank Melli, in response to Tehran's refusal to suspend its uranium enrichment program.[31] After the lifting of sanctions, BMI was the first Iranian bank to be reconnected to Swift.[32]
In 1999, Sadad Data Company was registered at Companies Registration Office and Non-commercial Enterprises.
After assignment of right to publish banknotes to BMI, a limited organization was created to publish the date of issue on banknotes. This organization evolved along with development of BMI; it was known as "BMI Printing House". Printing company of BMI received the publication license from Ministry of Culture and Islamic Guidance in order to allow publication of book and magazine; so it renamed "BMI Printing and Publishing Company".
The National Development Group is an investment company, which is listed on the Tehran Stock Exchange.
