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 confirmed Friday, as Washington moves to pressure Iran economically. The action targets UAE branches of Banque Misr, Egypt's second-biggest bank, blocking their access to US financial institutions.
Why is the US targeting Banque Misr's UAE branches?
The Treasury Department accuses Banque Misr's UAE branches of enabling Iran to bypass economic restrictions, part of a broader campaign to pressure Tehran. US Treasury Secretary Scott Bessent said the bank had continued "egregious support of the Iranian regime" despite repeated warnings. The action will take effect after a month-long public comment period.
What has Bessent said about pressuring Iran?
US Treasury Secretary Scott Bessent laid out plans this week for Iran's "economic asphyxiation," six months into a war on Tehran that remains locked in a stalemate. In a statement first reported by the Financial Times, Bessent said Washington had warned that Iran's enablers cannot continue to enjoy access to the US dollar and the global financial system. He said Banque Misr UAE "decided to find out the hard way" and called Friday's move the first step in holding it accountable.
How did the war with Iran begin?
US-Israel strikes targeting Iran from late February sparked Tehran's retaliation, blocking most traffic through the Strait of Hormuz and plunging the Middle East into war. The waterway is a crucial route for global energy transit, and the disruption sent global oil prices rising sharply. Bessent has vowed that the United States is declaring an "economic D-Day" on Iran, warning of harsh consequences for countries that do not join the campaign. He added this week that President Donald Trump was also contacting world leaders to request they halt interactions with Tehran, and that Bessent himself would make direct appeals to G20 counterparts at talks in Asheville, North Carolina, next week.
Why hasn't the US targeted China over Iranian oil?
Friday's action underscores the Trump administration's challenges in taking aim at larger targets. China is an important buyer of Iranian oil, and before the war Tehran exported millions of barrels a day, mostly to Beijing. Moves against institutions in China could strain the world economy and damage 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 is also imposing sanctions on the manager of the Dubai branch of Iran's Bank Melli, along with a Hong Kong-based front company accused of helping launder funds for a sanctioned Iranian exchange house.
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