US senators are pressing for sanctions to be imposed on Bank Markazi, Iran's central bank, for helping banks already blacklisted by Washington to do letter of credit (L/C) business.

If the senators succeed with their lobbying, Bank Markazi will become the fourth Iranian bank to be blacklisted by the US Treasury.

Democratic lobby

Harry Reid, the Senate majority leader, and 25 other Democrats in the Senate have written to President George W Bush asking him to designate the bank as a "terrorist entity" or "entity of proliferation concern".

The US Treasury says Bank Markazi has indirectly financed terrorism, but while it has been looking at imposing sanctions on the central bank for months, it has yet to announce such measures.

Blacklisted

Washington has already blacklisted Iran's three main banks - Melli, Mellat and Saderat -- for allegedly handling financial services for nuclear and ballistic missile programmes or acting as a conduit for "terrorist financing".

This has made it harder for them to obtain US dollars through third-party banks and apparently impossible for them to write US dollar-denominated L/C business.

Now, however, the Wall Street Journal says US financial-intelligence officials say Bank Markazi is handling US-dollar transactions for the blacklisted banks, and is also helping them by backing their existing dollar-denominated L/Cs.

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