Japanese banks move to halt all transactions with Iran

The move follows the exit of US from the nuclear agreement deal.

Japanese banks are said to be aiming to cease all Iran-related transactions by August after US president Donald Trump pulled out of the nuclear program agreement with Tehran, reports The Financial Tribune.

In May, Trump announced that he is withdrawing from the Obama-era deal as he expresses intent to reinstate penalties on Iran after the 90-day grace period expires in August.

Japanese banks resumed business with Iran after the removal of Western sanctions in 2015, according to the Fars News Agency. However, with thawing ties, the lenders appear to be acting quick to exit the scene amidst fears of US sanctions.

The country’s largest bank, Mitsubishi UFJ Financial Group (MUFG) is already on the move to stop all Iranian deals to comply with the reimposition of US sanctions against Tehran, FT added.

Also read: Japanese mega banks expand to Saudi Arabia

The bank has reportedly informed its Japanese customers about its decision, given that dealings with Iranian financial institutions will be prohibited after a 180-day wind-down period ending November 4. Units under Mizuho Financial Group have also started notifying clients of the change.

Sumitomo Mitsui Banking Corp, on the other hand, said that it will carefully consider its response in compliance with the law and based on US sanctions.

Photo from Morio - Own work, CC BY-SA 3.0

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