Türkiye Ends Bank Mellat Operations Amid Sanctions

Türkiye’s Banking Regulation and Supervision Agency has officially revoked the operating license of the Istanbul branch of Iran’s Bank Mellat. This decision terminates the institution’s lending activities in the country after more than four decades of operation, marking a significant shift in bilateral financial ties.

The regulator cited concerns regarding risks to depositors and overall financial stability as the primary justification for the move. According to reports from the GN auto geopolitics/middle-east: Iran nuclear desk, this action aligns with broader U.S. efforts to isolate Tehran’s financial networks through targeted sanctions.

Historical Presence Terminated

Bank Mellat has maintained a substantial footprint in Türkiye since the early 1980s, initially establishing itself in Istanbul before expanding to Izmir and Ankara. The bank described its Turkish operations as a prominent overseas branch that supported economic activity and facilitated joint trade projects between the two nations.

Despite its long history, the institution faced increasing scrutiny due to alleged links to Iran’s nuclear and missile programs. Data from the Banks Association of Türkiye indicates that at the end of 2025, the local operation held assets worth approximately 42.1 million dollars and employed 39 staff members.

Sanctions Pressure Intensifies

This revocation occurs against the backdrop of Operation Economic Outcast, a U.S. initiative launched in late August aimed at disrupting Iran’s remaining financial lifelines. Treasury Secretary Scott Bessent has warned that foreign entities facilitating sanctions evasion or doing business with designated Iranian institutions may face secondary penalties.

Washington has recently expanded its measures to include Iran’s aviation sector, targeting dozens of entities including airlines and Turkish companies accused of supporting Mahan Air. In response to these pressures, Mahan Air suspended flights to Istanbul and Ankara in September, further straining cross-border connectivity.

Broader Financial Implications

The move by the BRSA is part of a recent series of actions affecting Turkish financial institutions with ties to Iran. Last week, the Savings Deposit Insurance Fund took control of stakes in Golden Global Investment Bank, a lender sanctioned by the U.S. for alleged connections to Tehran.

Observers are now watching whether further Turkish banks will face similar regulatory actions. The situation highlights the growing difficulty for intermediaries in the region to navigate the expanding net of international restrictions while maintaining local business operations.