The Trump administration, through the U.S. Treasury Department, is moving to restrict the operations of Banque Misr, Egypt's second-largest bank, specifically targeting its branches in the United Arab Emirates. This action stems from accusations that these branches have been an economic lifeline for Tehran's leadership, particularly amid the six-month mark of the U.S. war against Iran. Treasury Secretary Scott Bessent had previously announced a new campaign to compel countries that continue to engage in business with Iran to cut financial ties or face U.S. retaliation.
The proposed rule, announced on Friday by the Treasury Department, seeks to revoke the Emirati branches of Banque Misr's access to the U.S. financial system. The department's news release detailed that between January 2024 and June 2026, these UAE-based branches processed approximately $1.8 billion for over 100 companies suspected of being part of Iranian shadow banking networks. Secretary Bessent emphasized the Treasury's commitment to severing Iran's remaining economic lifelines, warning that "Iran’s enablers cannot continue to enjoy access to the U.S. dollar and the global financial system."
Despite the significant sum involved and the strong rhetoric, the U.S. has stopped short of imposing full sanctions on Banque Misr itself. This more limited approach, focusing on the UAE branches' access to the U.S. financial system, signals a reluctance by the Republican administration to directly penalize major trading partners. The Central Bank of Egypt confirmed that the U.S. measures are limited to Banque Misr's UAE branch dealings in U.S. dollars with correspondent banks and do not extend to the bank's domestic operations or other overseas branches, affirming the soundness of Egypt's banking sector.
This move is part of a broader strategy to exert economic pressure on Iran, with Treasury Secretary Bessent having previously outlined plans for Iran's "economic asphyxiation." The action underscores the U.S.'s intensified efforts to isolate Iran from the global economy and highlights the risks financial institutions face when dealing with entities connected to the Islamic Republic, particularly in a conflict scenario.
