As part of the European Union’s sixth round of sanctions against Russia, Russia's biggest bank Sberbank will be removed from the global SWIFT messaging system.
The sanctions, announced Friday, June 3, also ban most Russian oil imports, prohibit accounting, auditing and consultancy services to Russian entities, and adds to the ever-expanding list of blacklisted f Russian individuals.
In a press release, the EU announced it is “extending the existing prohibition on the provision of specialized financial messaging services (SWIFT) to three additional Russian credit institutions Russia's largest bank Sberbank, Credit Bank of Moscow, and Russian Agricultural Bank - and the Belarusian Bank For Development And Reconstruction.”
SWIFT, the Society for Worldwide Interbank Financial Telecommunication, is a messaging system that connects about 11,000 banks in 200 countries and territories, with almost 4,400 banks in the U.S. on the platform. (Read: What is SWIFT and its Role in Global Banking?)
SWIFT is considered a vital piece of infrastructure for international banking. SWIFT doesn’t actually handle money transfers but transmits requests for transfers from one bank to another.
Unlike other Russian banks, Sberbank had not been included in previous SWIFT sanctions, because the bank managed energy payments between Russia and the West.
But now, EU nations have reached an agreement to prohibit the purchase, import or transfer of crude oil and other petroleum products from Russia into the EU. According to EU’s statement, “the phasing out of Russian oil will take from 6 months for crude oil to 8 months for other refined petroleum products.”
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