Lebanon’s central bank has halted direct payments to Al-Rassoul Al-Aazam Hospital, a facility linked to Hezbollah, while preserving its employees’ right to receive treatment there and claim reimbursement, in a move that highlights how international sanctions are increasingly affecting financial and service-related dealings with institutions associated with the group.

The measure applies to direct transfers from the Central Bank of Lebanon to the hospital or to Iran’s Export Development Bank, which handles its banking transactions.

Central bank sources told Annahar that employees can still seek treatment at the hospital but must pay their bills themselves and later submit claims for reimbursement under the bank’s existing medical coverage arrangements.

The sources stressed that the decision does not suspend medical coverage or prevent employees from using the hospital. It is intended to avoid direct financial transfers that could expose the central bank to compliance risks.

The move follows the central bank’s decision to revoke the Lebanese license of Export Development Bank of Iran. The bank has until the beginning of 2027 to complete the closure and liquidation of its operations, giving customers time to transfer their accounts and transactions to other banks.

The closure is expected to complicate Al-Rassoul Al-Aazam Hospital’s banking operations because its accounts are linked to the Iranian bank, the sources said. Halting direct transfers is intended to prevent potential complications while allowing the hospital’s patients who are central bank employees to continue receiving treatment and seeking reimbursement.

The measures could extend beyond the hospital. The central bank’s approach is to comply with international sanctions lists and avoid financial, commercial or service-related dealings with entities covered by the restrictions. Hospitals, insurance companies and other service providers could face similar measures if they are added to sanctions lists with which the central bank is required to comply.

The sources said the central bank does not make direct financial transfers to entities subject to the applicable restrictions. They also described its measures as administrative and supervisory, rather than political.

Circular 170 sets out compliance framework

The decision comes as the central bank tightens safeguards against dealings with entities subject to foreign sanctions.

On July 14, 2025, it issued Basic Circular No. 170, titled “Precautionary Measures to Protect Lebanon’s Financial and Economic Sectors from Dealing with Unlicensed Entities Subject to Sanctions Imposed by Foreign Authorities.”

The circular applies to institutions supervised by the central bank, including banks, financial institutions, money exchange and transfer companies, and electronic payment service providers. It covers both direct and indirect dealings with sanctioned entities and specifically names Al-Qard Al-Hassan Association, Tasahil, and Al-Yusr and Bayt al-Mal Lil-Muslimeen, as well as other entities appearing on relevant sanctions lists.

Central bank sources said the institution regularly issues circulars and warnings to employees concerning individuals and organizations listed under international sanctions regimes, in line with its obligations under applicable laws and restrictions.

Attention is also turning to how the Lebanese state will handle payments owed to hospitals, institutions and humanitarian and social organizations said to have direct or indirect links to Hezbollah following the revocation of Export Development Bank of Iran’s license.

According to information obtained by Annahar, one proposal under consideration is to pay these entities in cash rather than transfer the money through the Iranian bank.

Sources at the Finance Ministry said, however, that the decision on the payment mechanism rests solely with the finance minister. The minister has the authority to determine whether payments will be made in cash and to set the financial and administrative procedures required to implement the arrangement.

Sanctions timeline

The United States designated Hezbollah as a terrorist organization in 1995 and began imposing financial restrictions linked to the designation. In 2007, the U.S. Treasury Department added Al-Qard Al-Hassan Association to its sanctions lists, citing its links to Hezbollah financing.

In 2013, the European Union designated Hezbollah’s military wing as a terrorist organization, without including the group as a whole. The U.S. Congress passed the Hezbollah International Financing Prevention Act in December 2015 to restrict the group’s access to the international financial system.

More recently, the central bank issued Circular 170 in July 2025 to strengthen safeguards against dealings with unlicensed entities subject to foreign sanctions. In February 2026, Kuwait added eight Lebanese hospitals, including Al-Rassoul Al-Aazam Hospital, to its national list of entities linked to terrorism.