Noor Islamic Banksaid on Wednesday it stopped doing business with Iranian banks in December in compliance with international rules with regard to a US-EU led sanctions against the country.
A spokesman for the Dubai-based Noor Islamic Bank said, “As a UAE bank, we comply with all UAE Central Bank directives and regulations. We are in close contact with our trading partners in those countries that have imposed sanctions and we do not foresee any difficulties going ahead.”
“When we became aware, in December 2011, that unilateral US sanctions were to be applied against a number of Iranian banks we took pre-emptive action to end our business relationships with Iranian banks licensed in the UAE,” the bank said.
Meanwhile, Iran, under increasing pressure from a growing series of US and European sanctions aimed at thwarting its disputed nuclear programme, said on Wednesday that it would accept gold instead of dollars as payment for its oil. Iran’s state news agency said the move comes as US and European Union sanctions against Iran have made it difficult for buyers to make dollar payments to Iranian banks.
Mahmoud Bahmani, the governor of Iran’s central bank, is reported to have said that the country would accept payment in gold “without any reservation”.
As part of the sanctions, the EU has passed a ban on buying Iranian oil. The EU’s move will prohibit any company, in any member state, from buying oil from Iran after 1 July. At present, the EU accounts for 20 per cent of Iran’s exports.
China, the biggest purchaser of Iranian oil, has said it will continue imports, as will India.
The US already has a ban on Iranian oil in place. Iran has the world’s third-largest oil reserves. Crude oil is predominantly traded in US dollars, but Iran already accepts payment in other currencies.
In December 2011, US President Barack Obama signed into law a new set of sanctions that would penalise foreign financial institutions that do business with Iran’s central bank, though they provide an exception for the handling of oil payments.
These sanctions take effect at the end of June, while the EU plans to ban imports of Iranian oil from the beginning of July. Swift, the global bank-transfer service, said last week it is prepared to impose sanctions against Iranian financial institutions once the EU sets out implementation rules. Following the strict US move, the value of the Iranian riyal plunged against the dollar at the start of January.
On Tuesday, US Secretary of State Hillary Rodham Clinton insisted the Obama administration is moving swiftly to impose tough new sanctions on Iran. “What we are intending to do is to ratchet up these sanctions as hard and fast as we can, follow what’s going on inside Iran, which seems to be a lot of economic pressures that we think does have an impact on decision-making,” Clinton told the Senate Foreign Relations Committee.