The central banks of Egypt and the United Arab Emirates are coordinating over Banque Misr after the US Treasury moved to cut the Egyptian bank’s UAE branches from the US financial system over alleged dealings with Iran.
Central banks in Egypt, UAE join forces as US moves to cut Banque Misr from dollar system due to Iran links
- The US Treasury has cut Banque Misr’s UAE branches from the US financial system over alleged dealings with Iran.
- Egyptian and UAE central banks announced they are coordinating to ensure Banque Misr’s operations continue smoothly.
- The US action is limited to Banque Misr’s six UAE branches and does not affect its Cairo headquarters or other overseas operations.
- The US alleges the branches processed $1.8 billion in transactions linked to Iranian shadow-banking networks.
In a joint statement on Sunday, the two central banks said they were working together on the matter and that Banque Misr would take the necessary steps to ensure its operations continued without disruption.
The US action targets Banque Misr’s six UAE branches, rather than the bank’s operations in Egypt. Egypt’s central bank has also clarified that the restrictions do not apply to Banque Misr’s headquarters in Cairo or its other international operations.
The US Treasury said Banque Misr’s UAE operations had become an important channel for Iran’s access to dollars and international finance.
According to the Treasury, the UAE branches processed about $1.8 billion in transactions between January 2024 and June 2026 involving 103 companies potentially connected to Iranian shadow-banking networks.
DON’T MISS THIS:U.S. restricts UAE bank branch over Iran links as Africa’s 2nd-largest economy says its banks are unaffected
Washington subsequently moved to prohibit US financial institutions from processing transactions involving the branches.
The US alleges the branches processed $1.8 billion in transactions linked to Iranian shadow-banking networks.Date: June 17What happened: The US and Iran signed a 14-point memorandum of understanding, ending military conflict in the region.The MOU also included an agreement for Iran to reopen the Strait of Hormuz, with the nation establishing a 60-day toll-free period for commercial ships passing through the waterway.Oil prices: West Texas Intermediate crude dropped 2% on the news, while Brent crude traded mostly flat.Since the MOU was signed, Brent crude has dropped 9%, trading around $71 a barrel this week. West Texas Intermediate crude has dropped 11% over the same period, trading around $68 a barrel.Business Insider USA
ADVERTISEMENT
The move forms part of a broader US campaign to restrict Iran’s access to the international financial system as Washington intensifies economic pressure on Tehran amid the ongoing US-Iran war.
The Treasury has also targeted the manager of Iran’s Bank Melli branch in Dubai and a Hong Kong-based entity accused of facilitating money laundering for a sanctioned Iranian exchange.
The UAE central bank said it had launched an urgent examination of Banque Misr’s UAE branches, following the US action.
The examination covers transactions during the more than two-year period referenced by the US Treasury. Banque Misr said it was reviewing the American notice and assessing its implications.
DON’T MISS THIS:US-Iran War: Africa’s mounting debt crisis deepens since pandemic – fuels fresh inflation risk
Despite the US move, Egypt and the UAE are seeking to contain the fallout and maintain the bank’s operations.
The development is significant for Egypt because Banque Misr is the country’s second-largest state-owned bank, making the US action against its UAE operations potentially more consequential than sanctions against a smaller financial institution.
The case also highlights the growing pressure on banks operating between the Gulf, Africa and Iran as Washington expands its use of access to the dollar-based financial system as a tool for enforcing its Iran policy.
