Vladimir Putin, the president of Russia, issued a decree allowing Russian banks to halt their dealings with companies in regions where Russia has been sanctioned.
The directive also permits freezing the issue and transfer of money, according to TASS.
The president further authorized the Central Bank to set the maximum amount of the bank commission for currency transfers in the event that sanctions were to be applied to them.
Additionally, the Central Bank will have the authority to decide on risk ratio premiums while taking the currency issuer into consideration. Depending on the borrower’s ability to meet commitments with enough foreign currency earnings, various surcharges will apply to these credits and loans.
It was previously reported that major financial institutions JPMorgan and Citi had made the decision to sever their correspondent relationships with Russian banks. Numerous structures and perhaps Russian subsidiaries of foreign banks won’t be impacted by the measure.
After the commencement of the special operation in Ukraine, Western nations increased the pressure via sanctions on Russia. The Russian Central Bank had assets worth about €23 billion frozen by the European Union at the end of May. The United States said that it had frozen $330 billion worth of Russian assets, including around $300 billion from the Bank of Russia. The entire quantity of gold and foreign currency reserves that are frozen overseas is assessed by the Russian Ministry of Finance to be equal.
Additionally, the US imposed the strictest limitations on several Russian banks. In response to Russia’s recognition of the DPR and LPR’s independence on February 21, Washington imposed sanctions on Promsvyazbank, state-owned VEB.RF, and their affiliates. Similar sanctions were placed on VTB, Otkritie Bank, Sovcombank, and Novikombank on February 24, the day the military operation began. Sberbank, the biggest state-run bank in Russia, was added to the list on April 6.