US to set limits on Egyptian bank in effort to pressure Iran: official
The move is part of Washington’s wider effort to pressure Iran by cutting it off from the global financial system.
A flock of pigeons flies past the high-rise commercial building (L) serving as the modern headquarters of Banque Misr (Bank of Egypt), in Cairo on Feb 9, 2023. (Photo: AFP/Amir Makar)
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WASHINGTON: The Treasury Department is due to cut off a major Egyptian bank’s operations in the United Arab Emirates from the US financial system, an official said Friday (Aug 28), as Washington pushes to choke Iran off economically.
The move impacts UAE branches of Egypt’s second-largest bank, Banque Misr, blocking their banking access to US financial institutions.
US Treasury Secretary Scott Bessent laid out plans this week for Iran’s “economic asphyxiation,” six months into a war on Tehran that is now locked in a stalemate.
Washington has “warned that Iran’s enablers cannot continue to enjoy access to the US dollar and the global financial system,” Bessent said Friday.
“Banque Misr UAE decided to find out the hard way and, today, we are taking the first step in holding it accountable for its continued, egregious support of the Iranian regime,” he added in a statement first reported by the Financial Times.
The Treasury Department’s action will only take effect after a month-long public comment period.
Egypt’s central bank said officials “are in contact with the American side regarding these measures.”
It added that the US measure is limited to transactions of Banque Misr branches in the UAE “with correspondents in US dollars only, and none of these measures extend to any of the banks in the Egyptian banking sector.”
US-Israel strikes targeting Iran from late February sparked Tehran’s retaliation in blocking most traffic through the Strait of Hormuz, while plunging the Middle East into war.
The waterway is a crucial route for global energy transit, sending global oil prices rocketing.
Bessent vowed that the United States was declaring an “economic D-Day” on Iran, warning of harsh consequences for countries that do not join the campaign.
The US Treasury chief added this week that President Donald Trump was also contacting world leaders with a request to halt interactions with Tehran.
Bessent himself is due to make direct appeals to G20 counterparts in bilateral meetings next week, as finance ministers gather in Asheville, North Carolina, for talks.
But Friday’s effort underscores the Trump administration’s challenges in taking aim at larger targets.
Beijing for example is an important buyer of Iranian oil. Before the war, Tehran exported millions of barrels of oil a day, mostly to China.
Moves to hit institutions in China, however, could impact the world economy and would strain ties between Washington and Beijing ahead of an expected visit by Chinese President Xi Jinping to the US capital in September.
The Treasury Department said Friday it was also imposing sanctions on the manager of the Dubai branch of Iran’s Bank Melli, alongside “a Hong Kong-based front company that has helped launder funds for a sanctioned Iranian exchange house.”
Source: AFP/fs
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