Iran-Syria: a banking axis

Syria and Iran are both designated by the US State Department as sponsors of terrorism, while the countries’ major state-run banks are blacklisted by the US Treasury Department, through the Office of Foreign Assets Control (OFAC). But when plans to create a joint venture bank between the two countries, to be established in the Syrian capital Damascus, was quietly announced in 2008, the deal attracted surprisingly little attention internationally.

Paul Cochrane reports from Beirut and Damascus on how the alliance is progressing.

A very curious venture between two of the Middle East’s leading states has been three years in the making – it has transformed from a partnership involving Syrian and Iranian state-owned banks into a private commercial venture after Syria’s state-owned bank pulled out in 2009. As soon as the bank launches, which could be as soon as next spring, it risks immediate blacklisting by the US Treasury due to the involvement of Bank Saderat, an Iranian state-owned bank on the OFAC list.