Ukraine: EU agrees to exclude key Russian banks from SWIFT

The European Union has today agreed to exclude key Russian banks from the SWIFT system, the world’s dominant financial messaging system.

This measure will stop these banks from conducting their financial transactions worldwide in a fast and efficient manner. Today’s decision has been closely coordinated with the EU’s international partners, such as the United States and the United Kingdom.

President von der Leyen said, “At the speed of light, the European Union has adopted three waves of heavy sanctions against Russia’s financial system, its high-tech industries and its corrupt elite. This is the largest sanctions package in our Union’s history. Today’s decision to disconnect key Russian banks from the SWIFT network will send yet another very clear signal to Putin and the Kremlin.”

The list of banks affected has been published in the Official Journal.

The Council today introduced further restrictive measures in view of the Russian Federation’s unprovoked and unjustified military aggression against Ukraine.

The Council decided in particular to prohibit:

• the provision of specialised financial messaging services, which are used to exchange financial data (SWIFT), to Bank Otkritie, Novikombank, Promsvyazbank, Rossiya Bank, Sovcombank, VNESHECONOMBANK (VEB), and VTB BANK’. This prohibition will enter into force on the tenth day after the publication in the Official Journal of the EU, and will also apply to any legal person, entity or body established in Russia whose proprietary rights are directly or indirectly owned for more than 50% by the above-mentioned banks.
• to invest, participate or otherwise contribute to future projects co-financed by the Russian Direct Investment Fund.
• sell, supply, transfer or export euro denominated banknotes to Russia or to any natural or legal person, entity or body in Russia, including the government and the Central Bank of Russia, or for use in Russia.

Today’s decisions complements the package of measures announced by the High Representative after the video conference of EU Foreign Affairs Ministers of 27 February. Such package also includes the provision of equipment and supplies to the Ukrainian Armed Forces through the European Peace Facility, a ban on the overflight of EU airspace and on access to EU airports by Russian carriers of all kinds, a ban on the transactions with the Russian Central Bank, and the prohibition for state-owned media Russia Today and Sputnik’ to broadcast in the EU.

The European Union condemns in the strongest possible terms the Russian Federation’s unprovoked and unjustified military aggression against Ukraine, and demands that Russia immediately ceases its military actions, unconditionally withdraws all forces and military equipment from the entire territory of Ukraine and fully respects Ukraine’s territorial integrity, sovereignty and independence within its internationally recognised borders.

More information

The banks targeted by today’s measure were chosen as these banks are already subject to sanctions by the EU and other G7 countries.

It will take effect as of 12 March 2022. This will give SWIFT and other operators a brief transition period to implement the measure, thereby mitigating any possible negative impacts for EU businesses and financial markets. Depending on Russia’s behaviour, the Commission is prepared to add further Russian banks at short notice.

In addition, the EU has prohibited investing in projects co-financed by the Russian Direct Investment Fund. The provision of euro-denominated banknotes to Russia has also been prohibited.

Background

Today’s decision builds on the wide-ranging and unprecedented packages of measures the EU has been taking in response to Russia’s acts of aggression on Ukraine’s territorial integrity. These sanctions will have massive and severe consequences for Russia.

The EU stands united in its solidarity with Ukraine and will continue to support Ukraine and its people together with its international partners, including through additional political, financial and humanitarian support.

For More Information: European Commission – Press release

Link to the Official Journal

European Commission website on Ukraine

Memo on restrictive measures (sanctions)