Iran Privatization Organization, the state-run entity overseeing the sale of state-owned companies, plans to divest the remaining stake of the government in major privatized lenders and thereby make them "completely private", an official with IPO told Financial Tribune.
"IPO has made the proposal to divest the remaining shares of privatized banks, but the final approval rests with Cabinet ministers," Farid Dehdilani, international advisor to IPO, also said in a telephone interview.
The three major public banks, namely Mellat, Saderat and Tejarat, divested shares after the privatization process gathered momentum in the mid-2000s. The government, however, did not relinquish its role completely and kept a 20% share in most of these banks. This led to the occasional criticism of lawmakers and market players who said this only made things worse by creating a nebulous entity that poses a bigger threat to the "real private sector".
If IPO's proposal goes as planned, the shares of banks will be floated on the stock market similar to when the banks went public the first time around.
"While there was opposition to the idea of the government relinquishing all its shares, now a more favorable view exists in the government," Dehdilani said.
Currently, private banks are operating in the country, but in some cases government-affiliated companies and non-government public entities own shares in these banks, making it harder for them to act independently and initiate much-needed reforms.
According to Dehdilani, since the shares of even more strategic firms like petrochemical companies have been divested, there should be no obstacle to these banks becoming fully privatized.
Dehdilani estimated that a floatation of the shares of these three banks would generate as much as 150 trillion rials ($3.4 billion) for the government, boost its tax income and create jobs.