Treasury Moves to Cut an Egyptian Bank's UAE Branches Off From the U.S. Financial System Over Iran Ties

The Treasury Department proposed a rule on Aug. 28, 2026 that would sever the United Arab Emirates branches of Banque Misr, Egypt's second-largest bank, from the U.S. financial system, accusing them of serving as an economic lifeline for Iran's leadership. Treasury Secretary Scott Bessent said in a statement that the administration had "warned that Iran's enablers cannot continue to enjoy access to the U.S. dollar," and that Banque Misr UAE "decided to find out the hard way." The department separately sanctioned the manager of Bank Melli's Dubai branch and a Hong Kong firm it accuses of laundering funds for Iran. The rule is subject to a 30-day comment period.

The action stops short of sanctioning the Egyptian bank itself, which the Associated Press read as reluctance to penalize major trading partners that still do business with Iran, including China and India. It follows Bessent's announcement this week of a campaign pressing countries to sever financial ties with Tehran.

Egypt's central bank confirmed it is communicating with U.S. officials and said the measure is limited to the UAE branches' dollar transfers.