The European Union and the European Union agree to separate some Russian banks from the SWIFT system – El Financiero


Western countries have agreed to implement tough new sanctions aimed at further isolating the economy and Russian financial system After the initial sanctions failed to impress the president Russian President Vladimir Putin to withdraw from Ukraine.

The joint decision to disconnect some Russian banks from the SWIFT messaging system, used for online transactions, was announced in a joint statement on Saturday. trillions of dollarsAmong thousands of banks around the world. The measure targets Russian banks that have already been sanctioned by the international community, but could be extended to other Russian banks, if necessary, according to a German government spokesperson.

In addition, the countries said they would work together to impose “restrictive measures that would prevent the Russian Central Bank from deploying its international reserves in ways that undermine the impact of our sanctions.”

As the conflict in Ukraine intensified, a consensus emerged to prevent Russia from using its modern money pipelines and isolate it as a pariah along the lines of Iran, Venezuela, and North Korea. The United States and its European partners focused on a potential source of cash for the government in the 643 billion central bank reserves that Putin had accumulated prior to his attack.

Things are going fast.

“It is likely that the imposition of sanctions on the Russian Central Bank will have a significant impact on the Russian economy and its banking system, similar to what we saw in 1991,” said Elena Rybakova, deputy chief economist at the Institute of International Finance. This is likely to lead to a massive sell-off of banks and dollarization, with a sharp sell-off, depletion of reserves, and possibly a complete collapse of the Russian financial system.

All Russian banks that have already been sanctioned by the international community and, if necessary, other Russian banks will be excluded from the SWIFT international payment service system.

The West is imposing its financial grip on Russia as Putin dispels any hope of diplomacy to end the fighting in Ukraine by ordering his military to act on Saturday.

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