* Iran's Bank Mellat says some Turkish banks halt activities
* Other Turkish banks could step in
* Bank Mellat says U.S. applied pressure to Turkish banks
By Evrim Ergin
ISTANBUL, Sept 14 Several Turkish banks with
close ties to the European Union and the United States have
halted financial trade with Iran due to United Nations sanctions
though others could step in, according to Iran's Bank Mellat.
Younes Hormozi, chairman of Bank Mellat's Turkish unit, told
Reuters that Bank Mellat Turkey had dealt with a higher number
of transactions since Turkish banks halted activities.
He said his bank had approached new potential banking
partners in Turkey, but had still to hear their response.
Led by Washington, new sanctions imposed in July target
financial services and Iran's energy sector, making
international transactions harder and hitting Iran's ability to
import gasoline and secure foreign investment.
The measures are aimed at pressuring Tehran to curb nuclear
activities which the West fears might be aimed at making a bomb.
Iran says its atomic ambitions are purely peaceful.
NATO-member and EU candidate Turkey has improved ties with
neighbouring Iran in recent years and Turkey, along with Brazil,
pulled together a last minute uranium-swap deal in June that was
aimed at quelling fears over Tehran's nuclear ambition.
"Businessmen can still make their transactions," Hormozi
told Reuters. One of the biggest problems they faced however was
the inability to send money from Iran to Europe, for which they
needed Turkish banks' mediation in providing euros.
Turkish banks acted as settlement banks and exchanged
"What we suggest is trading with Turkish lira instead of the
euro. We expect trade to be made in Iranian currency and lira,"
Banking sources say trade between the two countries in local
currencies is "possible" but still "too soon".
Turkey's highly profitable banks weathered the financial
crisis largely unscathed. Foreign banks rushed to enter the
Turkish market several years ago to tap the country's strong
economic expansion and young growing population. Turkey also has
several participation banks.
Hormozi said an American delegation visiting Turkey had
warned banks about taking sides, prompting some banks to pull
out of Iranian transactions.
Hormozi said there had been no pressure placed on banks from
the Turkish government and the banks had taken the decision
The U.S. government wants all banks to refrain from
dealings with Iran, but Hormozi said that many banks continued
to trade with Iranian banks.
(Editing by David Cowell)