The U.S. Treasury, which so far had resisted pressure from lawmakers to sanction Russian banks over Syria dealings, put Tempbank, a small Moscow-based bank, on its list of sanctioned entities. This effectively cut the bank off from the U.S. financial system.
The Treasury also imposed sanctions on bank official Mikhail Gagloev as well as six Syrian government officials and two Syrian refinery companies, Banias and Homs.
The Treasury said Tempbank provided money and financial services to Assad's government. At one point, Tempbank delivered millions of dollars in cash to Moscow's Vnukovo Airport so cash couriers working for Syria's central bank could pick it up. Tempbank also provided services to Syria's Sytrol, a state oil company that is already sanctioned by the United States and the European Union, according to the Treasury.
Reuters also reported last October that the Commercial Bank of Syria opened accounts in Tempbank and was in talks with the bank to expand ties.
Tempbank has ties to financial markets in China, Europe and the United States, using Austria's Raiffeisen Bank as well as Russia's biggest state-owned banks Sberbank and a foreign office of VTB as intermediary banks, according to information on the bank's website.
Tempbank could not be immediately reached for comment after normal business hours in Moscow.
The sanctions come as the conflict in Ukraine has brought U.S.-Russian relations to their post-Cold War nadir. Syria's President Bashar al-Assad has been using Russian banks to access world markets, but the U.S. government had been resisting pressure from some lawmakers to place sanctions on the banks.
"Today's designation builds on Treasury's ongoing efforts to apply economic pressure on the Syrian government by choking off access to the international financial system," said David Cohen, Treasury undersecretary for terrorism and financial Intelligence. "We ... will continue to aggressively target individuals and entities supporting the Assad regime."
Last year, U.S. Senator Richard Blumenthal urged sanctions against Russian banks, which he said were helping to finance the Syrian government's war against rebel groups.
The United States said it has put sanctions on nearly 200 people and companies since the start of the Syrian civil war, which has killed more than 150,000 people and displaced millions of others. Russia, also one of Assad's biggest arms suppliers, has vetoed a number of U.N. Security Council resolutions condemning the Syrian leader.