UAE Central Bank to Probe Egyptian Lender Banque Misr Amid Iran Sanctions Pressure

The Central Bank of the United Arab Emirates announced on Saturday that it would conduct a “special and urgent examination” of an Egyptian state-owned bank operating within its borders, marking the latest escalation in the U.S. Treasury Department’s renewed campaign to isolate Iran financially.

The U.S. Treasury Department revealed last week that Banque Misr was allegedly helping Iran circumvent sanctions, bringing renewed scrutiny to the Emirates’ longstanding role as a key hub for trade with the Islamic Republic.

The Treasury Department proposed a rule that would prohibit the bank’s Emirati branches from engaging in transactions with American financial institutions. Officials described the bank as “a critical node for the Iranian regime’s access to U.S. dollars,” estimating that between January 2024 and June 2026, the bank’s Emirates-based branches processed approximately $1.8 billion in transactions “potentially tied to Iranian shadow banking networks,” thereby enabling Iran to evade U.S. restrictions.

Banque Misr responded by stating that it was addressing the allegations with “utmost seriousness and attention” and pledged full cooperation with the Treasury Department.

The bank emphasized its adherence to “all applicable laws, regulations, instructions, and supervisory controls” in an official statement. It further clarified that the proposed regulatory action would not impact its branches in Egypt or any other country outside the Emirates.

In related enforcement actions, the U.S. Treasury Department imposed sanctions on the manager of an Emirati branch of Bank Melli—Iran’s largest lender—as well as a Hong Kong-based company accused of laundering funds for an Iranian exchange house already under U.S. sanctions.

The Emirates, situated roughly 50 miles from Iran across the Persian Gulf, has cultivated robust economic and cultural ties with Iran for decades, even amid persistent political tensions between the two nations.

According to the Treasury Department, Banque Misr facilitated transactions for “front companies” based in the Emirates, some of which were reportedly involved in directing funds to Iran’s defense ministry and the Islamic Revolutionary Guards Corps.

The Emirati central bank confirmed it was “studying the available options regarding the status of the bank” in anticipation of the Treasury Department’s potential final ruling.

Emirati officials maintain that they crack down on any sanctions violations discovered within their jurisdiction. Earlier this month, the government announced a complete halt to all trade and financial transactions with Iran—a decision made just one day before the Trump administration launched its renewed economic pressure campaign against Tehran.

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