Europeans banks don’t want to go near Iran.
Some big companies have begun signing deals with Tehran since the U.S. and other global powers lifted long-running sanctions against the Middle Eastern country, but banks are very nervous after being burned in the past.
HSBC, Standard Chartered and France’s BNP Paribas have all been in trouble before — and paid billions in fines — for dealing with Iran while U.S. sanctions were in place.
So while they may see attractive commercial opportunities in the country of about 80 million people, they’re treading very carefully because some sanctions still linger, including a ban on conducting transactions with Iran in U.S. dollars. U.S. banks are also still banned from dealing with Iran.
The removal of many sanctions in January was part of a deal designed to prevent Iran from obtaining or building a nuclear weapon.
But Iranian officials have raised concerns that the country is not reaping the benefits of the deal because many business opportunities are still out of reach.
This could undermine the nuclear deal, and that’s worrying the U.S. government.
America’s top diplomat, Secretary of State John Kerry, met with senior executives from eight big banks in London on Thursday to try to reassure them that it is safe to start working with Iran again.
“As long as [banks] do their normal due diligence and know who they’re dealing with, they’re not going to be held to some undefined and inappropriate standard here,” Kerry told reporters.
Standard Chartered was clearly not persuaded by Kerry. The bank said in a statement emailed to CNNMoney it would not accept any new Iranian clients and would not perform transactions with anyone inside the country.
Germany’s Deutsche Bank is also keeping Iran at arms length.
“Deutsche Bank continues to generally restrict business connected to Iran,” it said in a statement.
Other banks that attended the meeting — including Barclays, Societe Generale and Santander — did not respond to CNNMoney’s request for comment.
Kerry said a range of other factors, aside from remaining sanctions, may also be holding banks back.
“There are other forces at play here,” Kerry told CNN in an interview earlier this week. “Iran needs to modernize its banking system. Iran needs to modernize the way it does some business.”
The fact that President Obama is set to leave office at the end of the year could also deter some companies who worry that his successor (i.e. presidential hopeful Donald Trump) might try to scrap the Iran nuclear deal and reintroduce sanctions.
