Iran not withdrawing funds from Europe: bank head

Wednesday, June 18, 2008; 3:07 AM

TEHRAN (Reuters) – Iranian banks are not moving funds from Europe, the head
of a state bank was quoted as saying, contradicting reports that Tehran was
withdrawing assets in the face of tightening sanctions over its nuclear

“Such an issue has not ever been put forward,” Ali Divandari, managing
director of Bank Mellat, was quoted as telling the semi-official Mehr News
Agency on Tuesday.

His comments were also carried by newspapers on Wednesday. “Iranian banks do
not have any problem with European banks and there is no reason for
(transferring) Iranian banks’ assets from European banks,” Iran
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News quoted him as saying.

An Iranian weekly previously said Iran has withdrawn $75 billion from Europe
to prevent the assets from being blocked under threatened new sanctions over
its disputed atomic plans.

Western powers are warning the Islamic Republic of more punitive measures if
it rejects an incentives offer and presses on with sensitive nuclear work,
but the oil-rich country is showing no sign of backing down.

The Shahrvand-e Emrouz weekly quoted Mohsen Talai, deputy foreign minister
in charge of economic affairs, as saying that a part of Iran’s assets in
European banks had been converted to gold and shares and another part
transferred to Asian banks.

Iran’s Etemad-e Melli newspaper, also quoting Talai, last week reported that
the world’s fourth-largest oil exporter was withdrawing assets from Europe
but did not give figures.

Iran has again ruled out suspending uranium enrichment despite the offer by
six world powers of help in developing a civilian nuclear program if it
stopped activities the United States and others suspect are designed to make

The offer — agreed last month by the United States, Britain
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el> , Russia
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and France
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and presented to Iran on Saturday — is a revised version of one rejected by
Tehran two years ago.

Iran’s refusal to suspend nuclear enrichment, which can provide fuel for
power plants or material for weapons if refined much more, has drawn three
rounds of U.N. sanctions since 2006. Tehran says it only aims to generate

EU diplomats have said the bloc is preparing an asset and funds freeze on
Iran’s biggest bank, state-owned Bank Melli, but that it first wants to see
how Tehran responds to the new offer.

The United States imposed sanctions on Bank Mellat and other Iranian bodies,
including part of Iran’s military, in October.

Bank Mellat has dismissed as “baseless” the U.S. charges, which included
accusing it of providing banking services to support Iran’s nuclear

Iran is making windfall gains from record global oil prices and said in
April its foreign exchange reserves stood at more than $80 billion.


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