A photo shows the exterior of Russia’s VTB Bank branch in Tehran, Iran, on May 23, 2023.
Fatemeh Bahrami | Anadolu Agency | Getty Images
The Treasury Department on Monday announced new sanctions against Russia’s state-owned VTB Bank as part of an effort to isolate Iran economically by targeting its business partners and other financial “enablers.”
The action follows Treasury Secretary Scott Bessent’s promise on Monday to sanction “big banks” and was the latest sanctions handed out as part of Operation Economic Outcast, the Trump administration’s non-military war strategy against Iran.
The new sanctions against VTB Bank Public Joint Stock Company, Russia’s second-largest bank, stem from allegations that the company helped Tehran evade sanctions by “establishing correspondent relationships with sanctioned Iranian banks.”
The new financial measures are expected to block at least tens of millions of dollars, making VTB “one of the most comprehensively sanctioned financial institutions in the world,” the Treasury Department said in a press release.
The bank had already been subject to U.S. sanctions in 2022 and early 2025 under the Biden administration. However, curbing banks could lead to indirect economic restrictions on China, the largest buyer of Iranian oil.
Some observers were quick to question how much of an impact the new sanctions would have.
“We’re still digesting it a little bit,” Tobin Marcus, head of U.S. policy and political affairs at Wolf Research, told CNBC following the Treasury’s announcement.
Marcus pointed out that VTB is a major Russian bank, but it is already facing significant sanctions. “The devil tends to be in the details,” he says.
“Under Operation Economic Purge, the Treasury Department will continue to target and disrupt those who provide the material, technical, and financial support that enables the Iranian regime to sustain its terrorist enterprises,” Bessent said in a statement. “Treasury will not tolerate any support for the regime and will continue to identify, expose, and isolate those who enable Iran.”
Monday’s action follows a handful of other sanctions the Trump administration has imposed on Iran since last month, invoking “Economic D-Day” and vowing to thwart the Iranian regime through global economic pressure.
The new sanctions also raised questions about potential indirect effects on China, Iran’s largest trading partner and oil buyer. VTB is reportedly the only Russian bank with a branch in China.
“This is a Chinese ploy,” Miad Maleki, a senior fellow at the Foundation for Defense of Democracies and a former U.S. Treasury Department sanctions official, told XPost.
“What changes today is that all Chinese banks in contact with Shanghai VTB now have secondary sanctions exposure for the Iran program as part of the Treasury Department’s operation to name banks on a weekly basis,” Maleki wrote.
“Beijing has protected its big banks from a fight with Russia. Protecting them from a fight with Iran is a different calculus,” he wrote, noting that Chinese President Xi Jinping is scheduled to meet with President Donald Trump later this month.
