The Iranian Association of Islamic Finance (IAIF) held a session on "Challenges, Issues and Solutions for Handing over Bank Properties", on the 19th of February, 2024. 
Mohsen Khodabakhsh,a member of the Board of Directors at Tourism Bank, Yaser Moradi,a member of the board of directors at Bank Saderat Iran, Mousa Shahbazi, the Secretary of the Government's Economic Commission and Vahab Ghelich, a member of the Monetary and Banking Research Institute of the Central Bank of Iran, were the speakers of the session.
Vahab Ghelich said the issue of handing over surplus assets of banks has been raised in the country's economy for several years. In terms of laws and regulations, positive developments have taken place in the past few years and we have seen the law to remove barriers to competitive production and improve the country's financial system.
He went on to say that the problem of handing over surplus assets of banks has 3 dimensions. The first dimension is the economic one, which must be examined from two aspects: the first direction is the causes of the creation and accumulation of surplus assets of banks", which should be seen to what extent it was forced or voluntary for banks and credit institutions. Naturally, the non-current claims of banks and the government debt’s paying back are one of the main reasons that caused the forced accumulation of these properties.
The most important complication is the spread of disharmony in the country's banking network, which has caused overdrafts from the central bank and inflation in the country's economy. The third dimension is the executive one. According to the law, the method of handing over surplus property of banks shall be auction.

Yaser Moradi said usually, surplus property is not purchased by banks, but it is acquired in exchange for customers' debts. Although, since years ago, laws have been developed regarding the non-obligation of property collateral in banks; however, property is still taken as collateral in banks and its sale and auction causes many problems. On the other hand, we had a law regarding the sale of properties owned by banks, which made the banks committed to sell the acquired properties through an auction within one year and before the auction they must inform the previous owner so that the property can be returned to him if he wishes.

Mohsen Khodabakhsh mentioned that banks are established in order to allocate surplus resources to people who need them. It seems that the discussion of bank ownership has been replaced by the discussion of shareholder ownership. We have witnessed several times that a production unit or factory was opened with the participation of a bank, and the bank's participation in the construction of this factory was not for the purpose of establishing a company and appointing the CEO for the factory, etc., but the bank was looking for economic participation. In general, I believe that we should pay more attention to the main reasons for the creation of surplus property, such as inflation.

Mousa Shahbazi said we are facing a series of structural factors and some legal problems in the emergence of a challenge under the title of handing over surplus assets of banks. It seems that the business model of banks is one of the most important structural factors that prevent the transfer of excess assets of banks. Some specialized banks practically should not have entered into the acquisition of endorsement properties. Another point is that, in inflationary conditions, the economic logic is not consistent with the transfer of property. Banks' focus on setting up multiple branches has aggravated this problem.
He added recently, the guidelines for the transfer of excess property have been approved. In the past, sometimes a price was set for the property that was planned to be sold, which was higher than the actual price and practically made the sale impossible, but according to the new law, the transfer price of companies whose shares are offered on the stock exchange shall be based on the stock table’s price. In the case of non-stock companies, the price shall be determined by an expert panel under the supervision of the Ministry of Economy. In the case of private banks, special regulations have been formulated.