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Compliance Procedures for Banks in Iran, Islamic Republic of

The Banking Studies and Regulations Department (BSRD) of the Central Bank of the Islamic Republic of Iran (CBI) plays a crucial role in designing and formulating rules and regulations to ensure effective supervision of banking and credit institutions in the country.

Objective

Established in 1999, BSRD’s primary objective is to exercise risk-based surveillance on banks and credit institutions while also staying up-to-date with international banking standards and procedures. The department is responsible for conducting continuous surveys on banking developments worldwide and contributing to customizing supervisory procedures.

Organization Structure

BSRD is comprised of several studies groups, including:

  • Credit and Banking
  • Financial and Accounting
  • Free Zones
  • Licensing
  • Supervisory Procedures and Systems
  • Compliance

Key Functions

Some of the key functions performed by BSRD include:

  • Preparing and setting out drafts of regulations related to banking supervision
  • Conducting comparative surveys on banking supervision procedures in Iran and other countries
  • Gathering banking and credit laws, regulations, directives, and circulars issued by CBI
  • Preparing and setting out rules for the establishment of banks, credit institutions, Qard-al-Hasanah funds, money changing units (exchanges), representative offices of foreign banks in Iran, and Free Trade-Industrial Zones
  • Conducting surveys to propose unified accounting procedures pertaining to compliance with internal/international accounting standards

Publications

BSRD has issued numerous publications on banking issues, including:

  • Regulations on large exposures
  • Capital adequacy
  • Connected lending

The department has also translated several documents from the Basel Committee on Banking Supervision, including:

  • Core Principles for Effective Banking Supervision
  • Sound Practices for Managing Liquidity in Banking Organizations

Translations

These translations are considered essential reading for banks operating in Iran, as they provide valuable insights into international best practices in banking supervision and risk management.