ECB Question Banks on Russia Exposure With Heightened Tensions

Source: FT

The European Central Bank caution lenders with huge exposure to Russia to prepare themselves for international sanctions against the country if Putin invades Ukraine. Euro Stoxx 50 down -0.28%, EUR USD down -0.66%

• The warning from the EBC comes as the US cautioned that Russia would suffer “massive consequences” if it sent soldiers into Ukraine.
• Sanctions would increase massive risks for the international banks with large Russian exposure, including Citi in the United States.
• ECB policymakers requested information on how the banks would handle the different situations, including as a move to prohibit Russian banks from accessing the Swift international payments system.
• The requests emphasized how the ECB wants to ascertain that European banks are complied with any sanctions requirements and can quickly cut out non-compliant clients.
• The central bank has evaluated the risks of different possibilities and pushed the banks to share information on their own assessments and contingency plans.