LONDON (AP) _ London branches of the Bank of Credit and Commerce International was used to finance sales of U.S. anti-tank missiles to Iran during its war with Iraq, The Financial Times reported today.

The leading British business daily, without quoting its sources, said the export of TOW missiles to Iran's Revolutionary Guards in 1985 was arranged by a British arms merchant who had boasted of his ties to former Lt. Col. Oliver North.

It said the arms dealer, Indian-born Ben Banerjee, who died of a heart attack in May 1990, had figured into the scandal in which North played a central role.

The report said Banerjee's family denied he was involved in the affair.

Since Banerjee appears to have acted only as a broker for the arms shipment, which was not directly exported from Britain, ''the deal was not illegal'' in the United Kingdom, The Financial Times said.

Luxembourg-based BCCI is at the center of a worldwide scandal involving allegations of fraud and money laundering. Regulators in eight countries - including the United States and Britain - began seizing its assets and operations earlier this month.

Today's report amplified accusations in the United States the scandal- tainted bank was used by North to set up accounts for covert operations.

BCCI, with its branches worldwide and strict privacy laws, was used by Saudi millionaire arms dealer Adnan Khashoggi to deposit money into North's Enterprise - the name by which his covert slush fund was known, said former Senate Iran-Contra counsel Arthur Liman. Enterprise money was then funneled to the Contras to circumvent a congressional ban on aiding the guerrillas.

The Financial Times said the 1985 deal involved $18.9 million and ''at least two payments through separate branches'' of BCCI in London that were disguised as shipments of 1,250 forklifts.

The report said Liman stated that BCCI was used for ''as much as $10 million of bank transfers that paid for the secret sale of U.S. TOW anti-tank missiles and other weapons to Iran that were part of the Irangate scandal.''

The story said the Enterprise funds were largely kept in accounts at a bank in Switzerland, Credit Suisse.

The Financial Times said Banerjee and his now defunct company, B R and W Industries, arranged the shipment of the arms to the Revolutionary Guards.

According to the story: ''Documents detailing the deal show the original order from Iran's Revolutionary Guards was made through front companies in Liechtenstein and Panama.

''The missiles, priced at $7,500 each for a total cost of $9.375 million, together with rocket-propelled grenades, Strella anti-aircraft missiles and automatic rifles, were shipped to Iran through a front company in Dubai, the Arabian Gate Trading Company,'' the report said.