Bank Sepah

Bank Sepah is a state-owned Iranian commercial bank founded in 1925 and headquartered in Tehran, operating under the supervision of the Central Bank of Iran and the country’s interest-free (Islamic) banking framework. It provides retail and corporate services including current and savings accounts, financing based on Islamic contracts (such as murabaha and ijara), guarantees, letters of credit, and domestic payments via the Shetab card network and online and mobile channels connected to Iran’s Shaparak infrastructure. The bank historically maintained international operations, notably through Bank Sepah International plc in London and branches in certain European financial centers, though cross-border activity has been intermittent and contingent on regulatory and sanctions constraints. In 2007, Bank Sepah was designated under United Nations sanctions; UN and EU measures were lifted in 2016 following the JCPOA, while U.S. sanctions have continued or been reimposed since 2018, affecting correspondent banking, access to certain currencies, and the scope of international services; customers and counterparties engaging in cross-border transactions face elevated compliance and transactional frictions. Domestically, Bank Sepah expanded materially through the state-mandated consolidation of armed forces–affiliated institutions—Ansar Bank, Hekmat Iranian Bank, Mehr Eqtesad Bank, Ghavamin Bank, and Kosar Credit Institution—approved in 2019 and executed over subsequent years, which increased its branch footprint and assets while adding integration work and legacy asset-quality exposures typical of the sector. The bank’s operating environment is characterized by high inflation, exchange-rate volatility, regulatory controls, and sanction-related limitations that can influence funding costs, capital measures, and the reliability of foreign-settlement channels. Public financial reporting is primarily in Persian with varying alignment to international standards; major global credit ratings are limited due to sanctions-related constraints. Account availability, onboarding requirements, and foreign-currency services are subject to Iranian regulations and external restrictions, and nonresident access is limited; deposit protection is provided within Iran’s domestic framework rather than by international schemes.