The United States Treasury Department has announced plans to restrict the operations of Egypt’s Banque Misr in the United Arab Emirates, aiming to tighten economic pressure on Iran amid ongoing tensions. The proposed rule, disclosed on August 29, would sever the Emirati branches of Banque Misr, Egypt’s second-largest bank, from accessing the U.S. financial system, specifically targeting transactions involving U.S. dollars.

Treasury Secretary Scott Bessent described the move as part of a broader campaign to economically isolate Iran, now six months into a conflict that has resulted in heightened regional instability. Bessent emphasized that nations and entities facilitating financial access to Tehran would face consequences, asserting that “Iran’s enablers cannot continue to enjoy access to the U.S. dollar and the global financial system.” He characterized the action against Banque Misr’s UAE operations as a first step in holding those entities accountable for their role in supporting the Iranian regime.

The Treasury Department’s measure stops short of full sanctions on Banque Misr and is subject to a 30-day public comment period before becoming effective. This restraint reflects the administration’s cautious approach toward key trading partners engaged with Iran, including Egypt, China, and India. Bessent stated a preference for allowing countries time to disengage from financial ties to Iran to avoid wider disruptions to the global financial system.

Egypt’s Central Bank acknowledged the proposed U.S. rule and confirmed ongoing communications with American authorities. In a statement, the Central Bank of Egypt clarified that the action is confined to Banque Misr’s branches in the UAE and limited to dollar transfers. The statement underlined that the measure does not affect Banque Misr’s domestic operations or other overseas branches, nor does it impact other Egyptian banks. It further expressed confidence in the stability of Egypt’s banking sector amid the developments.

The announcement coincided with separate U.S. sanctions targeting the manager of the Dubai branch of Iran’s Bank Melli and a Hong Kong-based firm accused of facilitating Iranian money laundering. Secretary Bessent is expected to advocate for continued international cooperation in isolating Iran economically at the upcoming Group of 20 finance ministers meetings, engaging with counterparts from major and developing economies.

The escalation follows a series of recent hostilities in the Middle East, including strikes attributed to Israel against Iranian targets and Tehran’s retaliation by restricting shipping traffic through the Strait of Hormuz, a critical chokepoint for global energy supplies. These events have contributed to increased geopolitical tensions and volatility in global oil markets. The U.S. administration has portrayed the current phase of sanctions enforcement as an “economic D-Day” aimed at crippling Iran’s financial networks, warning of further consequences for parties that maintain ties with Tehran.