China’s state banks began to limit financing to clients from the Russian Federation, writes Bloomberg. The reason was secondary US sanctions, which impose restrictions on cooperation with sanctioned individuals.
US President Joe Biden signed a decree on secondary sanctions at the end of 2023. The document gives the US Treasury the authority to impose restrictions on foreign banks in case of cooperation with the Russian Federation.
According to Bloomberg sources, since the beginning of the month, at least two Chinese financial institutions have decided to check the registration of their companies in Russia, as well as the presence of beneficiaries and beneficial owners in the Russian Federation.
The greatest attention is paid to cross-border transactions. Banks are determined to suspend cooperation with clients from the Russian Federation who are on the sanctions lists.
Financial organizations also intend to stop providing services to the Russian military sector. Sources say that not only Russian customers will be monitored, but also those who do business in the Russian Federation or transport critical goods to the country through third countries.
Risks for banks in the event of violation of the sanctions regime include a ban on correspondent accounts in US banks and a complete freeze on the ownership of foreign financial organizations in the United States.
Author:
Natalia Gormaleva
Source: RB
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