BB directs banks not to make transactions with US-sanctioned banks in Myanmar

The Bangladesh Bank (BB) has instructed commercial banks not to make financial transactions with Myanmar’s two banks, which are facing US sanctions.

A central bank official on Tuesday told news agency UNB that a letter was sent to banks in Bangladesh to be careful about these two banks.

The two banks are the Myanmar Foreign Trade Bank and Myanmar Investment and Commercial Bank.

On June 21, the United States Ministry of Finance (Office of Foreign Assets Control-OFAC) announced the sanction on these two banks in Myanmar in a circular. Myanmar's ruling military government uses these banks to buy arms and other goods from abroad, the US said.

The state-owned Sonali Bank of Bangladesh has business accounts with these two banks.

On August 3, the Ministry of Foreign Affairs of Bangladesh sent a letter to the Financial Institutions Division, a wing of the Ministry of Finance, regarding the business accounts of two Myanmar banks in Sonali Bank.

The letter quoted the US Embassy in Dhaka as reminding that the two Myanmar banks are currently under US government sanctions. The letter requested to take necessary measures in this regard. Then, Sonali Bank suspended the accounts.

Later, the BB sent a letter to all banks on August 20, citing the risks of OFAC imposing sanctions on the Myanmar Foreign Trade Bank and Myanmar Investment and Commercial Bank. The letter advised banks to refrain from financial transactions with these banks and collect updated information about the sanctions to take precautions.

Officials said that it is a regular process to warn banks regarding the ban on transactions so that any bank does not fall under the ban by dealing with these banks of Myanmar.