Banks in Turkey fear secondary US sanctions and refuse to work with Russia

Turkish banks fear secondary US sanctions against foreign companies helping Russia in the war in Ukraine and stop working with Russian banks. The day before it became known that Chinese banks are also tightening restrictions for Russia.

Banks in Turkey reports On January 17, the Kommersant newspaper, citing sources in the financial market and foreign trade participants, universally refuse to work with Russian banks. They severed correspondent relationships with almost all Russian credit institutions and suspended payment processing without formally closing contracts. An exception is for subsidiary foreign banks in Russia.

According to the publication’s sources, the situation became more complicated last summer and escalated sharply after US President Joe Biden on December 22 issued a decree on secondary sanctions against foreign companies that are helping the Russian Federation in the war against Ukraine. This decree allows US authorities to disconnect foreign banks from the US financial system for violating sanctions against Russia.

According to the president of the customs and logistics broker KBT, Yulia Shlenskaya, banks in Turkey have taken a break and do not carry out money transfers from Russia and to the country, writes dw. SOTA Logistic Business Development Director Igor Chernyshev said that even payment for services does not go through, and among Turkish banks only one misses payments as a correspondent.

Among the major participants in settlements with the Russian Federation, the publication’s sources name Nurol Bank, with which about 40 credit institutions of the Russian Federation worked, and Emlak Bank. Correspondent accounts of Russian banks in Turkey were opened in lira, dollars and other currencies – some banks accepted payments in rubles.

A TASS source in the Turkish banking industry said on January 16 that Turkish banks are “in standby mode” due to the decree of the head of the White House, since the document uses vague language that requires additional clarification.

Dmitry Sukhoversh, head of multimodal transportation at FM Logistic in Russia, added that Turkish banks, which tightened control after the introduction of the 12th sanctions package EUwhen making payments in lira, they began to require more data and documents to confirm the absence of sanctions against all participants in the chain – imported goods should not be on sanctions lists.

Just the day before, it became known that state-owned banks of the People’s Republic of China also began to limit their work with clients from Russia due to Biden’s decree. Bloomberg reports that at least two Chinese banks have decided to review their Russian business, sever ties with sanctioned clients and stop providing any financial services to the Russian military industry.

The Kremlin, in response to Bloomberg’s publication, said that the Russian Federation continues to develop bilateral relations with China.

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