Russia's Central Bank Sanctioned, Ousted From SWIFT System

The United States, European Union, and United Kingdom on Saturday agreed to put in place crippling sanctions on the Russian financial sector, including a block on its access to the global financial system and, for the first time, restrictions on its central bank in retaliation for its invasion of Ukraine.

Photo Insert: Russia declared then that kicking it out of SWIFT would be equivalent to a declaration of war.

The measures were announced jointly as part of a new round of financial sanctions meant to “hold Russia to account and collectively ensure that this war is a strategic failure for (Russian President Vladimir) Putin.”

The central bank restrictions target the more than $600 billion in reserves that the Kremlin has at its disposal, meant to limit Russia’s ability to support the ruble amid tightening Western sanctions, Zeke Miller, Rad Casert and Ellen Knickmeyer reported for the Associated Press (AP).

Saturday’s move includes cutting key Russian banks out of the SWIFT financial messaging system, which daily moves countless billions of dollars around more than 11,000 banks and other financial institutions around the world.

The fine print of the sanctions was still being ironed out over the weekend, officials said, as they work to limit the impact of the restrictions on other economies and European purchases of Russian energy.

Allies on both sides of the Atlantic also considered the SWIFT option in 2014, when Russia invaded and annexed Ukraine’s Crimea and backed separatist forces in eastern Ukraine.

Russia declared then that kicking it out of SWIFT would be equivalent to a declaration of war. The allies — criticized ever after for responding too weakly to Russia’s 2014 aggression — shelved the idea. Russia since then has tried to develop its own financial transfer system, with limited success.

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