Fx Reserve Currency Account Facility

Objectives and Lines Of Granting Short Term and Mid-Term Fx Facilities to the Imports From Fx Reserve Account:

BSI as an operating bank declares its readiness to grant the above mentioned facilities for all investment activities and development of capacity of manufacturing projects including all economic sections, investment , information technology ( IT ) , biological technology
(BT) , agricultural processing industries and agricultural mechanization instruments production industries , creation of new
capacities , purchase of import processed goods , financing generating projects , manufacturing investment projects in industrial section in special economic areas and industrial and free –trade zones .

Utilization of these facilities is possible through opening of an LC in favor of the seller or producer of machineries and raw materials or presenter of technical and engineering services and/or through cash withdrawal against commitment to present documents and Advance Payment Guarantee.

Profit of the above facilities is determined by the board of trustees of FX reseve acount.

Period and Amount of The Facilities:

-FX facilities amount, payable for each project, is maximum equivalent to the FX costs of the project investment (taking into account required primary working capital)

Facilities are granted in , CAD ,AUD, GBP , CHF, JPY , EUR , DKK , SEK .:

-Maximum period for financing of each project is 8 years of which maximum 3 years would be considered as facility utilization and commission period and maximum 5 years would be considered as operation ( repayment ) period .

-Facility utilization period will commence from the date the first opened LC should be operative not later than one year from the date of the contract with the client.

-BSI declares its readiness to provide part of advance payments of the documentary letters of credit from the above mentioned facilities.

Repayments , in general , are effected in foreign currency in the specified maturity dates

Guarantee of Facilities

1- The Bond of Iran Export Guarantee Fund or valid local and foreigner insurance companies.
2- A precious and easy to deal civil collateral.
3- The project location with all new buildings, plants and machinery.
4- The shares of quoted companies and unquoted companies at the discretion of the bank.
5- Collectable bills  at the discretion of the bank.
6- The final demands and the accepted statements of the public executive units in favor of the applicant.
7- The license of mine utilization.
8- Promissory note of the Directors.

Note : Backing of the granted facilities pro rata with the Rial equivalence of total amounts of the facility plus related FX charges based on the rate of contract signing date (in accordance with the appropriate cover ratio) would be obtained according to the current regulations .

Eligible applicants of the FX Facilities :

The mentioned facilities would be granted to the projects which, at the discretion of the Bank, enjoy from the economical, financial and technical necessary justifications and also the solvency of the said facility instalments.
The individualss and also the companies that the majority of their shares belong to the private or co-operative sections and their activities are in the following sections: industry, mine, agriculture, transportation and technical – engineering services.

Iranian companies which the production and service location of their activities are in Iran but a proportion of their shares accompanying with their rights to vote belongs to the investors who domiciled in abroad.
The companies in which the minor shareholder is the government (the government shares do not exceed %49 of voting shares) and their commercial activities lead to strengthening of the non governmental sector.
The executants of renovation and restructuring projects of non governmental textile manufacturing industries.
The non governmental airline companies to pre finance foreign revolving finance contract up to 15 percent of foreign exchange charges of their projects.
The cash equity of the facility applicant due to buying currency from bank and or presenting currency by him is possible.

In any project the equity of the facility applicant, whether individual or legal entity, must constitute at least %25 of the necessary investment (whether in rial or foreign currency) for project performance.
The other projects mentioned in regulations advised by the board of trustees for FX reserve account.

Performance Procedures:

1-    Presenting applicant’s request accompanying with commercial proforma
2-    Making a credit file in the branch and submitting it to the regional office.
3-    Preliminary assessment by the regional office and management of Bank Saderat province affairs
4-    Surveying the project in Project Approval Committee of Credits Affairs .
5-    Surveying the project from technical, financial and economical point of view in Projects and Investments Assessment Department.
6-    Obtaining credit authorities approval and advising it to the regional offices and provinces .
7-    Confirming the order registration form and allocating primary FX and presenting it to the ministry of commerce and industry .
8-    The confirmation of ministry of commerce and industry.
9-    Concluding a contract between Bank and Applicant .
10-    Opening a documentary credit in a FX branch .

Project supervising :

Since opening date of the documentary credit (beginning date of the utilization ) up to the payment of last instalment according to the terms and conditions of the concluded contract, the Bank is authorized to  supervise, according to its discretion, on the utilization way of the paid facility to assure about performance parameters and it can enjoy agreements such as Mosharekat Madany and Forush Aghsaty at each stage and according to the conditions and necessities of the project .

Note: It is obligatory to observe all the regulations related to documentary credit of import products while opening documentary credit from FX reserve account in addition to the specific issues.
All right reserved. Copyright © 2013 by Bank Saderat Iran