Lebanese banks will have to comply with stricter sanctions by the United Nations, the U.S. and the European Union on Iran, Central Bank Governor Riad Salameh said.
“It is up to the Lebanese banks to act in accordance with their interests and be sure, if they have to make an operation, that it’s an operation that can’t be contested internationally,” Salameh said in an interview late yesterday at his office in Beirut. The latest UN resolution “is very clear and we will respect it and make sure it is respected.”
Sanctions against the Persian Gulf nation have been ramped up this year after diplomatic efforts failed to halt its program of uranium enrichment, which can be used to produce fuel or make a nuclear bomb. Iran says it is for civilian purposes.
The UN Security Council imposed a fourth set of sanctions on June 9, curbing financial transactions and tightening an arms embargo. In July, the U.S. passed additional sanctions that target foreign suppliers of gasoline and block access to the American financial system for banks doing business in Iran. The European Union on July 26 banned investment and sales of equipment to the nation’s oil and natural-gas industries.
Stuart Levey, the U.S. Treasury undersecretary for terrorism and financial intelligence, visited Lebanon last month and met with Salameh as well as Finance Minister Raya Haffar el-Hassan for talks on sanctions against Iran. Salameh declined to provide details of the meeting.
Blom Bank SAL, Bank Audi SAL-Audi Saradar Group and Byblos Bank SAL, which are all among Lebanon’s top ten banks by assets, don’t allow transfers to Iran. There are 52 commercial banks operating in the country.
Lebanese banks are “also aware of the fact there is a list of people and institutions that the United States or the European Union have designated as parties not to deal with,” Salameh said. “It’s their responsibility therefore to act in a way that is in accordance with international law.”
He said Lebanese banks have advised the central bank that they will abide by the sanctions and that “historically there was very a small level of an operation for Iran, or Iranian companies or merchants through Lebanese banks.”
Bank Saderat, one of Iran’s largest lenders, which has six branches in Lebanon, will also have to comply with UN sanctions in accordance with Lebanese banking regulations, Salameh said.
The bank, which has been operating in Lebanon since 1963, has been under U.S. sanctions since 2006. In July, Germany’s financial regulator froze the assets of Bank Saderat’s Frankfurt and Hamburg units after the EU added the lender to a list of Iranian companies subject to “restrictive measures.”
Lebanon’s Shiite Muslim Hezbollah group, backed by Iran as well as Syria, is a member of the country’s national unity government. Hezbollah, classified by the U.S. and Israel as a terrorist organization, won popularity in Lebanon by helping force Israel’s army to withdraw from the country in 2000, ending an 18-year occupation. The group fought a monthlong war with Israel in 2006.