European banks, some of which have been punished for breaking
sanctions imposed on Iran, are skeptical it is now safe for them to
restore trade ties with the country and have largely held back since
the lifting of some restrictions in January.
"We want to make it clear that legitimate business, which is clear
under the definition of the agreement, is available to banks," Kerry
said on Thursday during what is likely to be his last trip to London
before November's U.S. election.
About 10 executives from leading European banks took part in the
meeting, along with British Foreign Secretary Philip Hammond,
secretary of state for business Sajid Javid and Norman Lamont, trade
envoy to Iran, a British official told Reuters.
British banks including Barclays, HSBC and Standard Chartered as
well as some from other European countries attended, sources
familiar with the matter said.

The United States and Europe lifted sanctions in January under a
deal with Iran to limit its nuclear program, but other U.S.
sanctions remain, including a ban on Iran-linked transactions in
dollars being processed through the U.S. financial system.
That has left Europe's banks nervous of resuming trade despite
encouraging words from the U.S., after lenders including BNP Paribas
and Standard Chartered paid out billions of dollars in fines to
resolve allegations of past sanctions-busting.
Standard Chartered said after the meeting: "Will not accept any new
clients who reside in Iran, or which are an entity owned or
controlled by a person there, nor will we undertake any new
transactions involving Iran or any party in Iran".
BRIDGING THE GAP
Hammond said the strategic objective was to draw Iran back into the
international community, and this meant overcoming "the reality of
what the European banks are finding in practice".
"We’re trying to bridge that gap...to allow these European and
global banks to support European businesses in resuming normal trade
and investment patterns with Iran," Hammond said.
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Banks' fears are exacerbated by the differing tone of rhetoric
between federal U.S. officials and State laws, many of which still
ban pension groups and funds from investing in overseas companies
that do business in Iran, Tom Stocker, a Pinsent Masons lawyer with
expertise in trade sanctions, said.
"It is all well and good for Kerry to give warm rhetoric but it
needs to be backed with a clear general license issued by the U.S.
authorities to conduct trade in Iran," Stocker said.
Ayatollah Ali Khamenei, the most powerful figure in Iran, has also
blamed delays in the resumption of trade 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.
European banks fear that legal business could be retroactively made
illegal if sanctions were to be re-imposed.
(Reporting by David Brunnstrom, Arno Schuetze, Lawrence White and
Kate Holton; Editing by Tom Heneghan and Alexander Smith)
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