Bank Melli Iran’s branches in the UAE are no longer permitted to conduct any financial transactions originating from or destined for Iran, including trade finance and money transfers. On Wednesday, September 23, the Central Bank of the UAE said the decision formed part of “strict enforcement measures” against all the Iranian bank’s branches in the country.

According to the UAE Central Bank, inspections found that Bank Melli’s branches had failed to comply with certain national laws, regulations and supervisory decisions, including requirements related to combating money laundering, terrorist financing and proliferation financing.

The authority said the new ban was imposed based on the inspection findings and under the legal powers of the Central Bank governor. It cited Article 168(1)(c) of Federal Decree-Law No. 6 of 2025 concerning the Central Bank, the regulation of financial institutions and activities, and the insurance sector as the legal basis for the action.

The Central Bank’s statement made no mention of revoking Bank Melli’s licence or closing its branches, nor did it clarify whether they would continue providing services to customers within the UAE. The official statement only specified that the branches were prohibited from conducting any financial transactions to or from Iran.

Bank Melli Iran has operated in the UAE since 1969 and has seven branches across several emirates, as well as its head office in Dubai. The branches remained operational before the latest decision. In late August, the Financial Times also quoted a Bank Melli employee as saying that daily transactions, lending and the issuance of letters of credit had not been seriously disrupted, and that the bank’s operating licence had recently been renewed by the UAE Central Bank.

وال‌استریت ژورنال: فشار ترامپ هنوز دبی را تغییر نداده؛ بانک‌ها و کسب‌وکارهای ایرانی همچنان فعال‌اند

The latest decision was announced about five weeks after the UAE suspended all business activities, trade and financial transactions with Iran “until further notice”. On August 19, the UAE Ministry of Foreign Affairs said the move was taken in response to escalating regional tensions affecting regional and international peace and security. The announcement came a day after the UAE Ministry of Defence said it had detected two ballistic missiles launched from Iran. Iran denied the UAE’s claim that the missiles had targeted maritime traffic.

Meanwhile, US pressure on Bank Melli’s overseas operations has intensified. On August 24, US Treasury Secretary Scott Bessent launched a campaign dubbed “Operation Economic Ostracism”, announcing that all Bank Melli branches outside Iran must be closed. Four days later, the US Treasury Department’s Office of Foreign Assets Control imposed sanctions on Reza Mohammad Taidi, manager of Bank Melli’s Dubai branch.

The US Treasury alleges that Bank Melli facilitated billions of dollars in transactions through accounts controlled by the Islamic Revolutionary Guard Corps’ Quds Force and helped transfer funds into and out of Iran. Bank Melli and Iranian officials had not issued an official response to the UAE Central Bank’s latest decision at the time of publication.

Reuters reported that it remains unclear whether Wednesday’s action by the UAE Central Bank forms part of tighter restrictions following recent US pressure and sanctions against Bank Melli, or whether it was an independent decision based on regulatory violations identified in the UAE. The UAE Central Bank did not indicate any connection between the two matters in its statement.