U.S. sanctions imposed on Moscow this month have complicated the foreign trade operations of Russian banks, but they are gradually adapting to the new realities, the finance director of VTB (VTBR.MM), opens new tab, Russia’s second-largest lender, said on Friday.
On June 12, the U.S. imposed Ukraine-related sanctions on the Moscow Exchange (MOEX.MM), opens new tab, which stopped trading in currency pairs with the dollar and euro.
The sanctions package also targeted China-based companies selling semiconductors to Moscow, and the U.S. Treasury said it was raising “the risk of secondary sanctions for foreign financial institutions that deal with Russia’s war economy,” effectively threatening them with losing access to the U.S. financial system.
VTB’s branch in Shanghai, the only representative office of a Russian bank in China, fell under the sanctions.
VTB’s Chinese branch “is (now) in a period of adaptation to the new realities,” Dmitry Pyanov, VTB’s finance director, said on Friday, adding that the bank “will be fine.”
Pyanov said the entire Russian banking system – which faced complications when it came to international co-operation in cross-border payments – was having to adapt to the new realities.
A person familiar with the situation at Chinese banks operating in Russia told Reuters on June 13 that Russian affiliates of Chinese banks had stopped processing settlements for Russia-China trade in dollars and euros.