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2h ago

U.S. Proposes Cutting Banque Misr’s UAE Branches From Dollar System

If finalized, the proposed rule would sever the branches’ access to U.S. dollar clearing and force UAE regulators to decide whether to restrict the lender’s local operations.

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Overview

  • FinCEN issued a notice on Friday proposing to designate Banque Misr’s five UAE branches as a “financial institution of primary money laundering concern” after alleging they processed about $1.8 billion from January 2024 through June 2026 for 103 companies linked to Iranian shadow networks.
  • The designation, if finalized, would bar U.S. banks from opening or maintaining correspondent accounts for those UAE branches and effectively cut them off from dollar payments used in global trade and finance.
  • The Central Bank of the UAE ordered a special and urgent forensic examination of the five branches on Saturday and said it is studying regulatory options for the bank’s status in the country.
  • Banque Misr said it is reviewing the U.S. notice and that its UAE branches continue to provide services in line with applicable rules while the reviews proceed.
  • The action is part of Treasury Secretary Scott Bessent’s Operation Economic Outcast and raises diplomatic and regional banking risks, so markets will watch the CBUAE’s forensic findings and whether further FinCEN steps target other regional banks.