SEOUL, Sept 8 (Reuters) - South Korea said on Wednesday itwould restrict the Seoul operations of an Iranian bank accused offacilitating Tehran's efforts to develop nuclear weapons.

"The government will restrict foreign exchange transactionsof 102 institutions ... including Bank Mellat, and 24 individuals...without the approval of the Bank of Korea," a governmentstatement said.

Washington has demanded Seoul adopt new sanctions on Iran inaddition to U.S.-authorised measures to punish Tehran for itsuranium enrichment programme. Tehran has said South Korea riskslosing substantial economic benefits in Iran if it follows theU.S. lead.

(Reporting by Jack Kim; Editing by Jonathan Hopfner)