Financeupdated 1h ago2 min read
Lebanon’s Central Bank Revokes Bank Saderat Iran’s License Amid U.S. Pressure
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Lebanon’s central bank revoked Bank Saderat Iran’s local license amid US pressure. Aimed at isolating Tehran amid US-led sanctions campaign.
License Revoked
Lebanon’s central bank canceled the local license of Bank Saderat Iran as the United States stepped up pressure on countries to sever commercial ties with Tehran. Central Bank Governor Karim Souaid told Bloomberg that the decision aims to "send a clear signal to the outside world that we are determined to protect our banking sector from any entity that might expose it to the risk of contamination."
The revocation was taken earlier this week and was framed as Lebanon’s determination to protect its banking sector from possible US sanctions. Lebanon’s central bank governor also stressed that Lebanon could not afford not to take such measures, while some decisions may be politically sensitive, in what The New Arab described as an apparent reference to Hezbollah.
Cash Economy and FATF
Karim Souaid linked the license cancellation to Lebanon’s push to secure removal from the Financial Action Task Force’s (FATF) gray list, saying illicit funds and money-laundering operations must be rooted out of the Lebanese economy. A specialised US firm hired by the central bank mapped Lebanon’s cash economy and identified suspicious financial activity.
Lebanon’s seven-year financial crisis saw the banking sector collapse and the local currency lose more than 95 percent of its value, locking millions of depositors out of their accounts. Talks with the International Monetary Fund for a support package were conditional on cracking down on illicit financial activity and passing sweeping reforms, which the government has promised to deliver.
Scope, Branches, and Unwind
Bank Saderat had a long-standing presence in Lebanon dating back to 1962 and operated through five branches in Verdun, Al-Ghubeiri, Bir el-Barajneh, Baalbek, and Sidon. The bank employed around 70 staff, while its activity remained limited due to its isolation for years from large parts of the local and international banking systems.
No detailed explanation had yet been issued by the Central Bank of Lebanon about the mechanism for implementing the decision, including the fate of branches, accounts, deposits, employees, and the deadline for winding down ongoing operations. The cancellation removed the legal cover that had allowed the bank to conduct banking activities in Lebanon, while the actual closure required determining a mechanism to terminate operations, settle obligations, and deal with accounts and deposits and the rights of employees.