Mellal Credit Institution (ticker Vomelal, وملل), the only licensed non-bank credit institution still active in Iran and a member of the "Banks and Credit Institutions" group on the Iran Fara Bourse, posted a net loss of 14.3 trillion tomans (143,389,965 million rials) and a loss per share of 7,169 rials for the fiscal year ended 29 Esfand 1404 (20 March 2026). The ticker has been halted since November 2025, and the institution is now run by a supervisory board appointed by the Central Bank of Iran. Unlike the usual template of fundamental analysis, the Vomelal file is not a search for the "intrinsic value" of a profitable enterprise; it is the story of an imbalanced financial institution, where the appearance of the balance sheet must be separated from economic reality and the mechanism of the loss explained.
Background: from the Askariyeh benevolent fund to a Central Bank ward
The institution's roots go back to 1987 and the "Askariyeh Gharz-al-Hasaneh (benevolent) Fund" in Mashhad. It became Iran's first free credit cooperative in 1994, was converted into a financial and credit institution with the Central Bank's in-principle approval in 2006, and took public-company (sahami-am) form in 2011. Its shares were listed under the ticker Vomelal on the Fara Bourse, and in July 2016 the institution's name changed from "Askariyeh" to "Mellal." After several capital increases, its registered capital now stands at 20,000 billion rials (2 trillion tomans), equal to 20 billion shares. Beyond banking, through its economic arm, the "Mellal Economic Development Group," the institution holds stakes in dozens of listed and unlisted companies (construction, hospitality, mining, financial services); that sprawling conglomerate ownership and the concentration of loans on affiliated companies are the core of today's crisis.
The ticker's status is telling: Vomelal is displayed as "suspended and halted," and its last recorded trade dates to around 14 Aban 1404 (5 November 2025) at a closing price of 2,282 rials. The halt followed the institution's falling under Article 141 of the Commercial Code for three consecutive fiscal years and its failure to file audited financial statements on time. On Codal, notices of "suspension of the issuer's security" and "cancellation of listing" have been recorded, showing that a review of the listing is under way. Put plainly, trading the share is effectively impossible, and the delisting risk is serious.
Fiscal 1404 performance: a structural loss, not a one-off
The main lines of the income statement for the fiscal year ended 29 Esfand 1404 (based on unaudited financial statements published on Codal; figures in million rials):
| Item (million rials) | 1404 | Approx. equivalent |
|---|
| Income from loans granted | 148,567,531 | 14.9 trillion tomans |
| Total operating income (joint) | 163,574,188 | 16.4 trillion tomans |
| Cost of deposit profit | (285,695,669) | negative 28.6 trillion tomans |
| Gross profit (loss) | (122,121,481) | negative 12.2 trillion tomans |
| Administrative and general expenses | (52,357,680) | negative 5.2 trillion tomans |
| Operating profit (loss) | (92,399,104) | negative 9.2 trillion tomans |
| Finance costs | (63,876,525) | negative 6.4 trillion tomans |
| Net loss | (143,389,965) | negative 14.3 trillion tomans |
| Loss per share (EPS) | negative 7,169 rials | |
Three key points emerge. First, income from loans roughly doubled versus fiscal 1403 (75,828,710 million rials), yet this nominal growth failed to offset a single rial of the loss. Second, the cost of deposit profit (28.6 trillion tomans) is nearly 1.7 times total joint operating income (16.4 trillion tomans); the institution pays far more for depositors' money than it earns from lending, and that gap builds a negative operating balance. Third, the negative 7,169-rial EPS matches the trading system's own estimate exactly, meaning the loss is a known, persistent phenomenon, not a one-off accounting adjustment.
The loss mechanism: why nominal income growth does not solve the crisis
In Iran's inflationary environment, a bank's nominal lending income naturally rises every year; but for Vomelal that nominal growth is deceptive. The problem is structural on two fronts. The first is the operating-balance gap: a large share of the institution's resources is locked not in income-generating loans but in non-productive assets (real estate and affiliated enterprises) and non-current receivables, so the institution must pay depositors profit while the matching assets do not generate enough cash return. The second is doubtful receivables and single-beneficiary concentration.
Based on Central Bank data cited by member of parliament Gholamreza Goudarzi, of roughly 50 trillion tomans in large loans extended by Mellal, about 33 trillion tomans (close to 67%) went to the institution's own subsidiaries, a pattern resembling the Bank Ayandeh case that deepens the imbalance. In one specific example, the Mellal Economic Development Group took more than 6,643 billion tomans in net loans across nine facilities, of which 3,467 billion tomans became doubtful.
A methodological note for the reader: in a profitable enterprise, nominal income growth should be adjusted for inflation to obtain real growth (see the difference between nominal and real profit). But at Vomelal even nominal growth does not reach profit; here inflation not only fails to help, it deepens the loss by raising the cost of deposit profit and the cost of funds. This is where Vomelal's fundamental difference from a manufacturer becomes clear: in a healthy productive company a large profit jump can be mostly inflationary yet still positive, whereas at Vomelal that same inflation is loss-making.
Balance sheet and capital adequacy
| Item | Value | Reference date |
|---|
| Deposits received from customers | 981,818,620 million rials (about 98 trillion tomans) | 29 Esfand 1404 |
| Outstanding loans granted | 433,651,533 million rials (about 43 trillion tomans) | 29 Esfand 1404 |
| Capital adequacy ratio | about negative 59% | end of 1404 |
| Accumulated loss (Central Bank statement) | about 65 trillion tomans | Aban 1404 |
| Liquidity imbalance (Central Bank statement) | about 45 trillion tomans | Aban 1404 |
| Registered capital | 20,000 billion rials (2 trillion tomans) | current |
| Number of branches | 339 | 1404 |
The most important reading of this table is the negative 59% capital adequacy ratio, against the Central Bank's legal minimum of 8% and the international standard of 12%. That ratio was about negative 17% at end-1402, about negative 31% at end-1403, and about negative 41% in Shahrivar 1404 (September 2025), a steady and accelerating deterioration. With an accumulated loss dozens of times the 2-trillion-toman registered capital, the institution's shareholders' equity is effectively negative; in accounting terms, this is "balance-sheet insolvency."
Risks
Governance and resolution risk is the most important. On 25 Aban 1404 (16 November 2025), citing Article 30 of the new Central Bank law, the Central Bank stripped the powers of the general assembly, board of directors, and executive board and appointed a three-member supervisory board (Jafar Jamali, Mehdi Seidi, Alireza Sadeghi); the former CEO (Seyed Amin Javadi) was removed and a judicial case opened against him. The regulator set a 100-day and six-month program to halt the imbalance and reform, and stressed that the difference between the Mellal file and Bank Ayandeh is that at Ayandeh the license was revoked and the "resolution" process began, whereas at Mellal only management has changed for now and the operating license stands. Even so, if the reform program fails, a resolution path is plausible; in that scenario, the Bank Ayandeh experience showed shareholders' equity value can fall close to zero.
Alongside this sit the ticker suspension and delisting risk (effectively zero liquidity), single-beneficiary risk and poor receivable quality, macro risk from the instability of the Tir 1405 (July 2026) conflict and a multi-week disruption of the banking network, and finally the fact that the 1404 figures are unaudited (subject to adjustment in the audited version).
Macro context (dated)
Analysis of Vomelal is incomplete without the macro backdrop. At the close of trading on Wednesday, 24 Tir 1405 (15 July 2026), the Tehran Stock Exchange overall index was around 4,893,834 points and the Fara Bourse overall index around 38,271 points, with the market under pressure from the Tir 1405 conflict; the free-market dollar had reached about 188,600 tomans. The Central Bank reported the twelve-month inflation rate to the end of Khordad 1405 (June 2026) at 57.7% and the point-to-point rate at 83.1% (the Statistical Center of Iran reported higher figures of 62% and 88.6%). The Money and Credit Council's approved ceiling for the one-year deposit rate is 20.5% and for the three-year rate 22.5%, rates that leave a depositor's real return deeply negative against inflation above 50%.
This backdrop cuts two ways for bank shares. On one hand, inflation and a weaker rial raise the nominal value of banks' real-estate assets and, at healthy banks, can strengthen book value through revaluation, as we saw in the analysis of Bank Mellat's capital and earnings per share (Vabmellat). On the other hand, the same inflation raises the cost of mobilizing funds (deposit profit) and, at a bank like Vomelal whose balance is negative, deepens the loss. For Vomelal, the second edge clearly dominates.
Valuation: why conventional tools do not work here
The price-to-earnings ratio (P/E) is meaningless here: because EPS is negative (negative 7,169 rials), the ratio turns negative and uninterpretable. The banks-and-credit-institutions group trades at a P/E of about 11.3, but comparing Vomelal with it is pointless. The price-to-book ratio (P/B) also fails, because shareholders' equity is negative and book value per share turns negative; this is the biggest difference from a conventional fundamental analysis, since at Vomelal there is essentially no positive "net asset value" on which to base a valuation.
Even market capitalization should be read with caution. Based on the last price of 2,282 rials and 20 billion shares, the institution's market value at its last trade was about 45,640 billion rials (about 4.6 trillion tomans). Given negative shareholders' equity, this figure should not be treated as a "fundamental valuation"; it is more of an "option value": the market assigned a slim probability to a rescue, capital injection, or broad revaluation scenario, against a high probability of near-total loss in a resolution scenario. The conclusion is clear: the multiples and net-asset-value tools used for a profitable enterprise are effectively inert for an institution with negative equity and negative 59% capital adequacy.
Outlook and what to watch
What determines the fate of Vomelal shares is not future profitability but two external factors: the Central Bank's regulatory choice between "reform" and "resolution," and the true quality of the institution's real-estate and enterprise assets at the point of sale or revaluation. To track the file, these signals matter: the release of the audited 1404 statements, performance reports on the supervisory board's 100-day and six-month programs, any fresh Codal notice on suspension or delisting, and any decision on a capital increase or resource injection. Sahmino's market events calendar can serve as a reference for following these notices.
This report is prepared solely for information and financial education and is not buy or sell advice. Any decision about a given ticker should rest on the reader's own independent review, their risk tolerance, and, where needed, consultation with a licensed financial adviser. The fiscal 1404 figures are unaudited, and some items (including the accumulated loss and liquidity imbalance) are based on the Central Bank's official statements at the time the supervisory board was appointed and may differ from the final audited figures.
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