From the Wall Street Journal via MSN, Jan. 13, 2026 9:00 pm ET:
Bad loans to regime cronies brought down Ayandeh Bank, accelerating a long-running financial crisis
The biggest harbinger that things were about to fall apart in Iran didn’t come from the thwarted anger of the country’s opposition or the frustrated hopes of young people hungry for more personal freedom. It came from the collapse of a bank.
Late last year, Ayandeh Bank, run by regime cronies and saddled with nearly $5 billion in losses on a pile of bad loans, went bust. The government folded the carcass into a state bank and printed a massive amount of money to try to paper over all the red ink. That buried the problem but didn’t solve it.
Instead, the failure became both a symbol and an accelerant of an economic unraveling that ultimately triggered the protests that now pose the most significant threat to the regime since the founding of the Islamic Republic half a century ago. The bank’s collapse made clear that the Iranian financial system, under strain from years of sanctions, bad lending and reliance on inflationary printed money, had become increasingly insolvent and illiquid. Five other banks are thought to be similarly weak.
The crisis hit at the worst possible time. The Iranian government’s credibility had already been battered by a 12-day war with Israel and the U.S. in June that showed it couldn’t defend its population from attack. Its leaders had refused to budge in negotiations over the country’s nuclear program, putting sanctions relief out of reach. In November, Israel and the U.S. threatened to strike again if Iran tried to reconstitute its ballistic missile arsenal or nuclear efforts.
The country’s beleaguered currency, the rial, tipped into a new downward spiral the country had little ability to stop. U.S. enforcement actions had cut Iran off from its crucial flow of dollars from Iraq, significantly reduced its hard currency earnings from oil sales and put its overseas reserves of foreign exchange out of reach with sanctions.
After decades of engineering workarounds and using shadowy flows of cash to keep the country’s battered economy functioning, Tehran had reached a dead end, with no tools to address a deepening economic crisis or meet the needs of an increasingly desperate population. Hundreds of merchants, who don’t typically join the country’s mass protests, took to the streets of Tehran to demand relief.
“This was a very well-connected bank, corrupt et cetera, which underscored that the banking system in itself is a channel for enrichment of the well-connected,” said Adnan Mazarei, a former deputy director of the Middle East and Central Asia Department at the International Monetary Fund. The failure of the bank added to what he called “a crescendo of the loss of legitimacy of the regime following the Israeli attack.”
Ayandeh Bank was founded in 2013 by Ali Ansari, an Iranian businessman who merged two state-owned banks with another he founded previously to form the new lender. He hails from one of the country’s richest families and owns a multimillion-dollar mansion in north London.
Politically, he is seen as close to former conservative President Mahmoud Ahmadinejad.
The U.K. sanctioned Ansari last year just days after the collapse of Ayandeh, calling him a “corrupt Iranian banker and businessman” who helped finance the sprawling Iranian elite paramilitary and business organization, the Islamic Revolutionary Guard Corps.
In a statement in October, Ansari blamed the bank’s failure on “decisions and policies made beyond the bank’s control.”
Ayandeh offered the highest interest rates of any Iranian bank, attracting millions of depositors and borrowing heavily from the central bank, which printed money to keep the institution afloat, economists said. Like other troubled Iranian banks, Ayandeh had a large number of nonperforming loans, one of a range of factors that eventually drove it to failure.
Its largest investment was the Iran Mall, which opened in 2018. The project displayed an opulent excess that made little sense amid the stagnation in the rest of the Iranian economy. Twice the size of the Pentagon, the mall is a city within a city with its own IMAX movie theater, a library, swimming pools and sports complexes, along with indoor gardens, a car showroom and a hall of mirrors modeled on a 16th century imperial Persian palace.
Economists and Iranian officials said the project was an example of self-lending, in which Ansari’s bank effectively lent money to his own companies. When it folded, a report in the semiofficial Tasnim news agency, citing a top central bank official, said that more than 90% of the bank’s resources were tied up in projects under its own management....
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