This study examines the challenges of Iran’s international banking system and the underlying factors shaping them through a comparative perspective with Turkey’s banking reform experience. The research data were collected through in‑depth semi‑structured interviews with 15 experts in the field of international banking and analyzed using qualitative content analysis. The findings indicate that limited integration with the global financial system, incomplete implementation of international standards, lack of full compliance with FATF requirements, exchange rate volatility, weak corporate governance, and the high level of country credit risk are among the major challenges facing Iran’s international banking sector. The causal analysis of the study further reveals that these challenges are largely influenced by foreign policy orientation, the dominance of the U.S. dollar in the global financial system, financial sanctions, and legal and regulatory constraints. In contrast, Turkey’s experience following the 2001 financial crisis demonstrates that institutional reforms, strengthening banking supervision, alignment with international standards, and attracting foreign investment can enhance the position of a country’s banking system in the international financial arena.