The U.S. Treasury Department says the Export Development Bank of Iran is illegally helping the Iranian government violate United Nations sanctions.
Treasury officials Wednesday designated the bank as a "proliferator," saying it provides financing to Iran's missile procurement network.
The Treasury Department's decision effectively bars U.S. entities and citizens from doing any business with the Export Development Bank of Iran (EDBI). It also freezes any of the bank's financial assets that are found in the United States.
In 2007, the Treasury Department blocked all financial transactions with Iran's state-owned Bank Sepah. It said that bank was an active participant in the Islamic Republic's pursuit of weapons of mass destruction.
Treasury officials say the Export Development Bank of Iran has since stepped in as one of the leading intermediaries to handle Bank Sepah's financing, including payments that are linked to weapons of mass destruction.
The U.S. Treasury Department says the EDBI was established in 1991 as an Iranian state-owned financial institution to serve Iran's import and export communities.
It adds that the EDBI operates as the Iranian representative for the Islamic Development Bank, a multinational institution that cultivates economic and social improvements in member nations.
Some information for this report was provided by AFP, AP and Reuters.