Imperial Bank of Persia

Nineteenth-century Iran has been described as "one of the most backward countries in the world". As usury was forbidden under Islam, the traditional money lenders in Iran were mainly Jewish money-changers or sarrafs. The only form of money in circulation was gold and silver coins. A first attempt to create a modern European-style bank was the Oriental Bank Corporation, a British venture established in 1845 but which did not survive long. A successor entity, the New Oriental Bank Corporation, opened in 1884 but suspended its operations after a year. The New Oriental Bank Corporation (Bank Jadid Sharq) was again established in 1888 and opened branches in Tehran, Tabriz, Rasht, Mashhad, Isfahan, Shiraz, and Bushehr.

Paul Julius Reuter obtained the Reuter concession in 1872, entailing exclusive rights over many resources of Persia. While the main motivation for the concession was in order to develop railroads, it also gave Reuter a monopoly over banking for sixty years. The concession's leonine terms was resented by Iranian public opinion, alarmed Russia, and was also a concern for the British government which had been kept away from Reuter's negotiation until the last minute. Due to mounting pressure, the Shah cancelled the concession in 1873, invoking the fact that Reuter failed to initiate the railway project within 15 months as the text committed him to.