Dr. Mohammad Reza
Farzin, president of NDFI explained the current situation of the economy, the
political status and the developments ahead of the country. Referring to the
importance of NDFI in the economic position of the country and its pivotal role
in cutting reliance on oil revenues, he highlighted the need to view NDFI from
a long-term, strategic perspective, capable of financing developmental projects
and contributing to the economic stability. He drew a picture of the NDFI
roadmap for the new Iranian year (1392)[1],
emphasizing on investments abroad he said that NDFI has started the new Iranian
year with a clear and documented plan, consisting of 9 pillars:
1- Balanced
allocation of resources among all sectors and provinces through the agent
banks,
2- Increasing the
number of agent banks and amending the agency contracts with the banks based on
their risk ratings and performance,
3- Organizing a
mechanized online comprehensive data bank for The inflow and outflow of NDFI resources
to expedite allocation as well as monitoring all the functions for allocation
of resources,
4- Improving
transparency rating and assets ranking of NDFI in the international arena,
5- Diversifying the
assets in various foreign markets for risk distribution,
6- Enhancing
cooperation with international investors and economic practitioners,
7- Promoting
cooperation with international monetary and financial institutions, including
the World Bank, IMF and Islamic Development Bank,
8- Getting into the
foreign assets' markets in particular Sukuk market in the Middle East and Asian
markets,
9- Execution and
finalizing the supervision and credit rating model.
Dr. Farzin reported on the
performance of NDFI during last year, saying: NDFI established itself through
its performance in line with its plans,
in a way that its developmental role in the economy was established. The resources of NDFI hit 48.5 billion dollars,
making it the largest financial institution in the country. The transparency
rating of NDFI has improved sharply during last year and plans have been made
to improve it further.
According to the
approved plan, NDFI assets will be diversified through purchase of low-risk
fixed-income assets. The companies issuing the assets, and the assets
themselves should have AAA ratings.
The target for making
investments in foreign assets is 10% of NDFI resources which will increase
gradually. The benefits of this approach are:
-
Optimizing the risk through making diverse investments
in diverse markets and the foreign markets anchor the risk of domestic markets,
-
Disbursements in the domestic markets, currently done
through the agent banks, shall be made to the extent that the banks may take
risks,
-
Allocation of resources in the domestic markets are
made to the extent that do not cause overheating or macro-economic risks and defaults
of the banks,
-
In the medium
term, the allocations shall move towards moderate risk and acceptable return.
The floor for the returns should be higher than the average world inflation to
maintain the purchasing power of the resources in mid-term and long-term
periods,
Given the situation of domestic production sector, he pointed out the
necessity of providing finance for this sector in national currency in line
with the annual budget, although the main task of NDFI is to finance in hard
currencies.
Some specific proposals have been submitted to the parliament to
authorize NDFI for making investments in the domestic financial markets. The
fact that NDFI is merely authorized to carry out activities through the banking
system increases the risks of NDFI.
Preparing the ground for NDFI to
enter domestic financial markets, may reduce the risks and facilitate financing
of the projects. Making investments in backward regions of the country, through
the developmental organizations is among the other plans of NDFI for the current year which need the approval
of the parliament.
[1] .
Persian year of 1392 starts on 21st March 2013