TEHRAN - The Central Bank of Iran (CBI) has announced it will hold a first round of bond auctions under a new administrative government that came to office in August.
A statement by the CBI said that a total of 50 trillion rials ($182 million) worth of sukuk bonds, or bonds that compliant with Islamic principles, will be on offer for sale to banks and credit institutions on November 9.
The statement said that as the issuer of the bonds, the Iranian finance ministry will be responsible for declaring the winners of the auction.
The CBI has held 18 rounds of weekly auctions for government bonds since the start of the calendar year in Iran in March.
That comes as a new administration led by President Ebrahim Raisi had promised it will minimize borrowing to prevent any further expansion of Iran’s money supply.
Iranian finance minister Ehsan Khandouzi said in October that the government had managed to avoid using bond issuance for funding its daily expenditures for a second consecutive month.
However, experts believe bond issuance has played a major role in helping the Iranian government shore up its finances at a time the country is grappling with the economic impacts of the US sanctions and the spread of the coronavirus pandemic.
The value of bonds on offer in the new round of auctions is almost half that sold in a previous round in late September, a sign the government wants to put a cap on borrowing.
CBI’s Saturday statement said the top lender will avoid bidding for the sukuk bonds in the new round of auction and will simply act as a mediator between the government and the buyers.