U.S. Secretary of State John Kerry will meet with top bankers in London on May 12 to reassure them that the United States will not stand in the way if they want to do business with Iran.
He contended that some banks have used remaining U.S. sanctions on Tehran as an "excuse" to not venture into Iran, despite their ability to do so now that most global sanctions have been removed under Tehran's nuclear deal with world powers.
"We sometimes get used as an excuse in this process," Kerry said shortly after arriving in London on May 10. "Businesses should not use the United States as an excuse if they don't want to do business, or if they don't see a good business deal...That's just not fair, that's not accurate."
Major British banks are expected to attend the meeting, including Barclays, HSBC, and Standard Chartered, along with other European banks.
Kerry stressed that banks should only avoid doing business with Iranian businesses and individuals who the United States continues to target with sanctions, such as companies associated with Iran's Islamic Revolutionary Guards Corps.
"It's important to have clarity and the clarity is that European banks, as long as it's not a designated entity, are absolutely free to open accounts for Iran, trade, exchange money, facilitate a legitimate business agreement, bankroll it, lend money -- all those things are absolutely open," he said.
Despite repeated assurances from Kerry and other top U.S. officials, Reuters reported that none of the big European banks with extensive ties to U.S. banks and markets has been willing to get involved with Iran for fear of running afoul of sanctions.
They worry that because of the many interconnections their European branches have with U.S. branches, it would be difficult to avoid at least technical violations of a U.S. ban on processing U.S. dollar transactions with Iran through the U.S. financial system.
One major European bank, BNP Paribas, got hit with a huge fine of $9 billion in 2014 for processing such transactions for clients in Iran -- a steep penalty that has left a big impression on European banks.
Moreover, while the Obama administration is adamant that banks outside the United States can do business with Iran, banks fear that the next president who takes office in January may not take the same stance.
The leading Republican presidential candidate, Donald Trump, and Republican congressional leaders all opposed the nuclear deal with Iran and have warned that the United States must strictly enforce all remaining sanctions.
With European banks reluctant to take chances, the Iranian government has complained that it is not reaping the full economic benefit that had been expected from the nuclear deal.
Supreme Leader Ayatollah Ali Khamenei, the most powerful figure in Iran, has blamed delays squarely on the United States.
"The U.S. Treasury...acts in such a way that big corporations, big institutions, and big banks do not dare to come and deal with Iran," Khamenei said in March.