Ukraine: UK bans Russian banks from clearing payments in Sterling
The UK will ban Russian banks from clearing payments in Sterling and has frozen the British assets of a further three financial instiutions today.
Foreign secretary Liz Truss said the US will also ban Russian banks from clearing payments in US dollars as well.
She said that investment firm VEB, Sovcombank and Otkritie Bank will all have their British assets frozen immediately, with all Rusian banks to be hit with freezes in the days to come.
It comes after the UK has already begun to block out major Russian banks from operating in the UK and has moved with other western countries to ban Russia’s central bank from accessing its internationally held currency reserves.
Boris Johnson last week also imposed other sanctions on Russian companies to stop them from being able to raise capital in British markets, while Moscow has also been banned from issuing state bonds in the UK.
Truss said “the UK and our allies will have to endure awesome economic hardship as a result of our sanctions”, but that “our hardships are nothing compared to those endured by the people of Ukraine”.
“We are determined to go much much further,” she said.
“We want a situation where they can’t access their funds, their trade can’t flow, their ships can’t dock and their planes can’t land.”
Foreign Affairs Committee chair and Tory MP Tom Tugendhat called on the UK government to ensure “the monies frozen, the monies seized, which are stolen very often from them in the first instance will be held and returned to the Russian people when this criminal conspiracy that laughably calls itself a government falls and they have a proper administration to which it can be returned”.
Thousands of Russians have descended on cash machines across the country today, while the Russian Rouble is down by nearly 30 per cent cent against the US dollar this morning after western nations moved to block Russian banks from the SWIFT global payment system.
The value of the rouble tumbled around 30 per cent against the dollar as exchanges opened after a sweeping set of financial curbs were placed on Moscow over the weekend, dropping to its lowest ever level against the global currency benchmark.
In response, Russia’s Central Bank raised its key rate from 9.5 per cent to 20 per cent this morning, in a desperate attempt to shore up the plummeting Rouble and prevent the run of banks.
Sberbank, Russia’s largest bank, has seen its stock price on the London Stock Exchange plummet by more than 70 per cent today.