The managing director of Iran's state-operated Bank Saderat says it is responding to US sanctions preventing other banks from doing US dollar business with it by writing deals in other currencies.

One of the measures taken by the bank in its endeavours to counter US financial sanctions recently imposed on it is to open letters of credit (L/Cs) in other currencies.

Currency switch

Iranian news agency IRNA reports the bank's managing director, Hamid Borhani, saying, "Saderat Bank of Iran has replaced US dollars with euros in its international transactions to deal with the US measure."

The report adds that Borhani views the US' treatment as illegal and consequently Saderat Bank of Iran will appeal to the International Monetary Fund, the World Bank and the World Trade Organisation against the US action because the bank maintains it obstructs Iran's trade with the rest of the world.

Fewer US dollars

According to IRNA, Borhani said that 60-70 per cent of Bank Saderat's transactions were in US dollars but since US financial sanctions were imposed, the bank decided to open up L/Cs in currencies other than US dollars.

"Of course, we have financial commitments from the past which are being observed as per the former procedure, but, currently the transactions in US dollars are on a downward trend," he told IRNA.

Blacklist

The US Treasury blacklisted Bank Saderat on 8 September for terrorist financing, thereby preventing banks from doing US dollar business with it.

London-based HSBC andSwiss-based UBS and Credit Suisseare amongst major international banks to say they will withdraw from the Iranianmarket while all of Japan's major banks have already halted dollar-denominated transactions with Bank Saderat.

Borhani told IRNA that the US Treasury's allegations are baseless and the measure taken by Washington goes against international banking rules.

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