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Russia-Ukraine crisis: UK joins new sanctions on major Russian bank

Officials said the government intends to make further related designations this week

Chancellor Rishi Sunak on Monday announced new sanctions against the Central Bank of Russian Federation (CBR) that include immediate steps to prohibit any UK natural or legal persons from undertaking financial transactions involving the CBR, the Russian National Wealth Fund, and the Ministry of Finance of the Russian Federation.

The move, taken in concert with the United States and the European Union, follows several recent sanctions on Russian banks, entities and individuals, in the context of Russia’s invasion of Ukraine.

The latest sanction is intended to prevent the CBR from deploying its foreign reserves in ways that undermine the impact of sanctions imposed by the UK and its allies, and to undercut its ability to engage in foreign exchange transactions to support the Russian rouble.

Officials said the UK Government intends to make further related designations this week, working alongside international partners.

Sunak said: “We are announcing this action in rapid coordination with our US and European allies to move in lock step once more with our international partners, to demonstrate our steadfast resolve in imposing the highest costs on Russia and to cut her off from the international financial system so long as this conflict persists”.

Andrew Bailey, governor of the Bank of England, said: “We welcome the steps taken today by the UK Government, in coordination with EU and US authorities, as an important and powerful demonstration of the UK’s commitment to the international rule of law”.

The new sanctions will cover restrictions against Russian financial institutions and measures to prevent Russian companies from issuing transferable securities and money market instruments in the UK. Officials said this will form a sweeping addition to existing financial restrictions, and is in addition to the prohibition of the Russian state raising sovereign debt in the UK already announced.

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The sanctions also include power to prevent designated banks from accessing Sterling and clearing payments through the UK. Banks subject to this measure will be unable to process any payments through the UK or have access to UK financial markets.

The sanction will also include a set of measures to significantly strengthen the UK’s trade restrictions against Russia, prohibiting the export of a range of high-end and critical technical equipment and components in sectors including electronics, telecommunications, and aerospace.