UK announces sanctions against Russia's central bank

The government has announced new measures targeting the Central Bank of the Russian Federation (CBR) in response to the invasion of Ukraine.

It said the new measures will prevent Russia’s central bank from “deploying its foreign reserves in ways that undermine the impact of sanctions” and “undercut its ability to engage in foreign exchange transactions to support the Russian rouble”.

The step is also being taken by the US and the European Union and follows a previous announcement by the UK of sanctions aimed at Russian president Vladimir Putin and the Russian economy.

Ursula von der Leyen, president of the European Commission, has also said that Russian banks will be excluded from the SWIFT system.

“We will also ban the transactions of Russia's central bank and freeze all its assets, to prevent it from financing Putin's war,” said the EU president in a statement on Sunday.

The government said it would take all necessary steps to prohibit any UK citizen from undertaking financial transactions involving the CBR, the Russian National Wealth Fund, and the Ministry of Finance of the Russian Federation.

“These measures demonstrate our determination to apply severe economic sanctions in response to Russia’s invasion of Ukraine,” said chancellor Rishi Sunak. “We are announcing this action in rapid coordination with our US and European allies to move in lock step once more with our international partners, to demonstrate our steadfast resolve in imposing the highest costs on Russia and to cut her off from the international financial system so long as this conflict persists.”

The sanctions will prevent Russian companies from issuing transferable securities and money market instruments in the UK. They will also stop designated banks from accessing Sterling and clearing payments through the UK, matching the power the US already has.

Banks subject to this measure will be unable to process any payments through the UK or have access to UK financial markets.

“The Bank of England continues to take any and all actions needed to support the Government’s response to the Russian invasion of Ukraine,” said Andrew Bailey, governor of the Bank of England. “We welcome the steps taken today by the UK Government, in coordination with EU and US authorities, as an important and powerful demonstration of the UK’s commitment to the international rule of law.”

    Share Story:

Recent Stories

New Business Frontiers
FStech’s Mark Evans discusses the future of financial services with Liu Jianning of Huawei, covering the limitations that current thinking can impose, how financial institutions can embrace technology to be both agile and resilient, and making space for the organisation to focus on the job of creating innovative business models and on delivering business value for their customers.

The Future of Intelligent Finance
FStech Group Editor Mark Evans sits down with Jason Cao, President of Global Financial Services Business Unit, Enterprise BG at Huawei ahead of its Intelligent Finance Summit which was held on 3rd and 4th of June in Shanghai. This Q&A delves into key trends in digital transformation of the financial services industry as well as a look at how data, robotic infrastructure, intelligent storage and innovative technologies are shaping the future for FSIs.

Cracking down on fraud
In this webinar a panel of expert speakers explored the ways in which high-volume PSPs and FinTechs are preventing fraud while providing a seamless customer experience.