Canada has banned its banks from conducting transactions with the Russian Central Bank in connection with the military operation in Ukraine. Previously, sanctions against the Central Bank were also imposed by the European Union and the USA banks were banned from any transactions with the Central Bank of Russia” />
Canada has banned its banks from conducting any transactions with the Russian Central Bank in connection with the military operation in Ukraine, according to the government website.
Such the measure “will prevent Russia from using its international foreign exchange reserves”; and severely limit its ability to “finance an invasion of Ukraine,” the Canadian government said.
In addition, Canada will freeze assets and ban transactions with Russian sovereign wealth funds.
On the night of February 28, sanctions against the Central Bank were introduced by the European Union. He banned operations related to the management of reserves and assets of the Central Bank. As an exception, transactions with the Central Bank necessary to ensure the financial stability of the European Union as a whole or its member countries may be allowed.
Following the European Union, the United Kingdom announced sanctions against the Bank of Russia. They are included in the “response to the invasion of Ukraine” and are aimed at “preventing the use of reserves to reduce damage from sanctions” imposed by London and its allies, the British government said. This step will actually “immobilize” any assets of the Central Bank denominated in dollars or passing through US jurisdiction, said the US Treasury.
Sanctions against the Central Bank led to a sharp fall in the ruble exchange rate and a new collapse in the value of shares of Russian companies abroad. For the first time in history, the dollar exchange rate rose above 100 rubles.
In order to prevent the spread of the financial crisis, even before the opening of trading, the Central Bank more than doubled the key rate— from 9.5% to a record 20%. In addition, the Central Bank banned foreigners, companies and citizens from selling Russian assets. Sell-offs by non-residents affect the situation both on the stock market and on the foreign exchange market: having sold assets for rubles, foreigners go to exchange them for currency.
The Russian authorities do not consider military operations in Ukraine an invasion. According to President Vladimir Putin, the special operation was a forced measure, and its purpose— protect residents from “genocide”.
Regarding the new sanctions against the Central Bank, the Kremlin said that the authorities had been preparing for a long time for possible restrictions. “Until now, we have had no reason to doubt the efficiency and reliability of our Central Bank. There is no reason to doubt the effectiveness even now,»,— said Presidential Press Secretary Dmitry Peskov.