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Ukraine slaps sanctions on Russian banks

Sberbank, PIB, VTB, BM Bank and VS Bank are forbidden to transfer capitals to the parent structures.

Ukraine slaps sanctions on Russian banks
Photo: Photo: presidential press service

On Thursday, March 16, President Petro Poroshenko enacted the decision of the National Security and Defense Council of Ukraine on the introduction of sanctions against five Ukrainian banks, which are owned by Russian state.

The sanctions are imposed for one year in respect of PJSC Sperbank, PJSC VS Bank, PJSC Joint Stock Commercial Industrial Investment Bank (Prominvestbank), PJSC VTB Bank, and PJSC BM Bank. The sanctions provide for restrictions on the withdrawal of capital outside Ukraine in favor of related entities.

Previously, the National Bank said that this applies to any operations in favor of the parent banks, such as the provision of interbank loans, deposits, subordinated debts, placement of accounts on correspondent accounts, etc.

Also, the ban concerns the payment of dividends and interest.

The NBU assures that the sanctions are designed not to affect the customers of banks. The banks will not be closed.

According to Article 5 of the Law of Ukraine On Sanctions, decisions on the imposition of sanctions on individual legal entities are adopted by the National Security and Defense Council and enforced by a decree of the President of Ukraine.