China warns US against sanctioning banks over Iran ties

China has pushed back against US pressure to restrict financial dealings with Iran, warning that punitive measures against Chinese banks would prompt a forceful response from Beijing.

The warning reflects growing friction between Washington and Beijing over Iran policy, with the US seeking to enforce secondary sanctions that would penalise foreign companies and financial institutions maintaining business ties with Tehran.

Chinese officials have characterised the cooperation with Iran as legitimate commercial activity and have defended their right to maintain economic relationships not subject to unilateral US restrictions. The dispute underscores broader disagreements between the world's two largest economies over trade, sanctions regimes, and regional geopolitical influence.

Sanctions targeting major Chinese banks could have significant implications for cross-border financial transactions and global banking networks. Beijing's threat of retaliation suggests it is prepared to escalate the dispute should Washington proceed with additional measures against Chinese financial entities engaged in Iran-related business.

The confrontation adds another layer to US-China tensions, which have intensified over trade policy, technology competition, and diverging approaches to regional security issues across Asia.