Euromoney, March 2016
The lifting of sanctions meant a stream of international banks would make their way to Iran, right? Wrong. Some banks admit they are taking the first steps on the road to Tehran. Others might be, but they certainly do not want to talk about it. And in either case, there are plenty of barriers to getting there.
Euromoney has travelled to one of Europe’s grandest capital cities for an interview with three bank executives who recently went on a trade mission to Iran. When we arrive, the bank’s communication officer is ashen-faced. She is really sorry, but at the last minute the compliance department has vetoed Euromoney’s meeting. The feeling is that it is not appropriate to be talking about it.
Why? Doing business with Iran is now legal again. The sanctions have been removed by the EU and UN and suspended by the US. The rules are reasonably clear; keep your trade out of dollars and your counterparties well out of the remaining sanctions list entities and you will be OK.
European corporates are clearly comfortable with it all. Daimler, Peugeot and Airbus are just a few of the bigger names among a glut of European multinationals keen to re-engage with an exciting new market. But western banks are not following them in – or even talking about the possibility of following them in.
“It is still very difficult to receive payments from or transfer funds into Iran,” says Silke Waters, a spokesperson at Daimler in Stuttgart, which announced a truck manufacturing deal with automotive company Iran Khodro shortly after sanctions were lifted. There is a job to be done and a great deal of opportunity, but the big banks do not seem to want it.
Why not? The short answer is fear of US reprisals. After an era in which some European banks received sanction-related fines as high as $9 billion, the west’s biggest banks are so firmly on the side of caution that they are not doing anything. They do not even want to be seen thinking about doing anything, as if the very act might see them fall foul of the US Treasury.