Page 100 - RusRPTFeb24

Sovcombank, one of Russia's 13 most important credit institutions according to the central bank, said the UN had opened an account with an undisclosed, non-sanctioned Russian lender, to allow for transactions in rubles. A UNEP spokesperson said $114,000 in membership fees from three Russian banks that are part of the UNEP FI has been received. Office of Foreign Assets Control (OFAC) placed Sovcombank on its Specially Designated Nationals and Blocked Persons (SDN) List in 2022 making it impossible for the bank to work with US entities or people and froze its US assets. The bank has applied for a temporary license.
Chinese state banks are stepping up compliance on funding to Russian clients amid threats of secondary sanctions from the US, Bloomberg reported Tuesday, citing anonymous sources familiar with the matter. Last month, the United States threatened to cut off access to its financial system for foreign banks that back companies targeted for supporting Russia’s defence industry. According to Bloomberg's sources, at least two unidentified Chinese banks have recently launched reviews of their Russian business involved with cross-border deals. “Banks will sever ties with clients on the sanctions list and will stop providing any financial services to the Russian military industry regardless of the currency or the location of the transactions,” the outlet wrote.
Turkish banks are breaking off correspondent relationships with Russian banks, refusing to process payments from Russia, or sharply tightening checks, Kommersant reports.
The December threats of sanctions for working with Russian sanctioned banks seriously frightened banks from third countries. Following Chinese banks tightening checks on clients from Russia, it is now the turn of Turkish banks.
Since the end of December, Turkish banks began to sever relations with Russian counterparties. Correspondent relationships with partner banks are severed, in some cases officially, and in others in the form of suspension of payment processing without formal closure of contracts. One of Kommersant’s interlocutors clarifies that this does not apply to subsidiary foreign banks in Russia.
Employees of logistics companies working with Turkey told Kommersant that cross-border payments have become dramatically more difficult. The president of the customs and logistics broker KBT, Yulia Shlenskaya, said that “banks in Turkey have taken a break and are not making money transfers from Russia and to the country.” Managers of other companies explain that Turkish banks began to demand more data and documents to confirm the absence of sanctions against all participants in the chain and the absence of sanctioned goods in it. Only one of the Turkish banks allows payments as a correspondent, but if the number of payments is more than 50 on the day of the application, it takes several days, one of them told Kommersant.
100 RUSSIA Country Report February 2024 www.intellinews.com