After 1979
On 7 June 1979, after the Iranian Revolution, all Iranian private banks were nationalized, quite to the dismay of the founding families, and became state-owned. In 1980, branches and sub-branches of BSI in the Iranian provinces were turned into independent banks, named Bank Saderat Ostan (province). Today, BSI has 29 owned provincial bank subsidiaries and over 200 affiliated companies, supervised by Ghadir Investment Company. Iranian banks are administered on the basis of a law passed by the Islamic Revolution Council on 25 September 1979, and the provisions of its Articles of Association.
Bank Saderat is used by the Government of Iran to transfer money to what the U.S. has stated are designated terrorist organizations, including Hezbollah, Hamas, the Popular Front for the Liberation of Palestine-General Command and Palestinian Islamic Jihad, according to the U.S. Department of the Treasury.[5][6]
Under the Iranian Transactions Regulations (31 CFR Part 560) in 2008, U.S. banks may process certain funds transfers involving an Iranian bank, such as transfers for authorized or exempt transactions and "U-turn" transactions. U-turn transactions allow U.S. banks to process payments involving Iran that begin and end with a non-Iranian foreign bank. Bank Saderat will not be able to participate in any transfers involving U.S. banks, effective from the date that the amendment to the regulations is filed with the U.S. Federal Register. By prohibiting U-turn and all other transactions with Bank Saderat, the bank is denied all direct and indirect access to the U.S. financial system.[7]
Bank Saderat Iran currently conducts banking in the UAE, handling Iranian trade in and out of Dubai. The bank mainly deals in project financing, letters of credit and bank guarantees (demand guarantees), whereas other activities remains less important.
In February 2013, the European General Court in Luxembourg ruled to annul sanctions by the European Union (EU) against the bank, stating that the EU "is in breach of the obligation to state reasons and the obligation to disclose to the applicant ... the evidence adduced against it". The EU may appeal the decision.[8] As of 2016, the EU asset freeze was still in effect.[9]
In 2019 an EU court rejected BSI's appeal for £78.7m in damages the bank claimed to have suffered after the EU placed it on their sanctions list.[10]
