West slaps sanctions on Russian banks

Western countries have imposed sanctions on a number of Russian banks as well as individuals in response to Moscow's recognition of Ukraine's breakaway regions of Donetsk and Lugansk as independent.

The US introduced sanctions on February 22 against two major Russian state banks, Vnesheconombank and Promsvyazbank, which hold a combined $80bn in assets. Any assets they have in the US will be frozen, and US individuals and businesses will be prohibited from doing business with them. They will also be cut off from the US financial system.

Washington has also imposed measures against five Russian elites who have close ties with the Kremlin. Earlier it also prevented US individuals and companies from engaging in new investment, trade and financing in Donetsk and Lugansk.

The UK meanwhile announced on February 22 it was freezing the assets of Promsvyazbank, as well as Russia's Bank Rossiya, Black Sea Bank for Development and Reconstruction, IS Bank and Genbank, and would also prevent Russia from selling sovereign debt in London. It too has targeted long-standing Putin associates within the Russian elite, including Gennady Timchenko and brothers Arkady and Boris Rotenberg.

Timchenko is a major shareholder in Russian gas producer Novatek and petrochemicals firm Sibur. The Rotenbergs in the past were closely involved in gas pipeline construction for Gazprom, but have distanced themselves from many of their businesses since being hit by US sanctions in 2014.

EU foreign ministers also voted unanimously to ban trade with the breakaway regions and target banks involved in financing Russian military operations and the destabilisation of Ukraine. It also intends to limit Moscow's access to EU capital and financial markets, and is placing initial sanctions on 351 Russian politicians who voted for recognising the separatist regions as independent.

Japan's government has banned the issue of Russian bonds in its country, and frozen the assets of certain Russian individuals, while Australia has targeted some members of Russia's Security Council. As previously reported, Germany has halted the certification process of Russia's Nord Stream 2 pipeline, despite previously describing it as strictly a commercial project.