The U.S., European allies, and Canada agreed Saturday to remove key Russian banks from the interbank messaging system, SWIFT, an extraordinary step that will sever the country from much of the global financial system.
“This will ensure that these banks are disconnected from the international financial system and harm their ability to operate globally,” the global powers wrote in a joint statement announcing the significant retaliatory measure. Moscow’s exclusion from SWIFT, which stands for the Society for Worldwide Interbank Financial Telecommunication,
means Russian banks won’t be able to communicate securely with banks beyond its borders. Iran was removed from SWIFT in 2014 following developments to Tehran’s nuclear program. SWIFT is an independent enterprise based in Belgium that serves as an internal messaging system between more than 11,000 banks and financial institutions in over 200 countries and territories.
“Any decision to impose sanctions on countries or individual entities rests solely with the competent government bodies and applicable legislators,” SWIFT said in a statement. “Being incorporated under Belgian law, our obligation is to comply with related EU and Belgian regulation.” The group said it’s seeking details on the entities the new effort will impact.
After the announcement, Ukrainian Prime Minister Denys Shmyhal welcomed the measure, writing in a tweet, “Appreciate your support and real help in this dark time. Ukrainian people will never forget this! Keep holding the line! We are on our land.”
In addition, the U.S. and its allies announced that they will impose restrictive measures aimed at preventing Russia’s central bank from deploying its international reserves in ways that may undermine sanctions.
“This will show that Russia’s supposed sanctions proofing of its economy is a myth. The $600 billion-plus war chest of Russia’s foreign reserves is only powerful if Putin can use it,” a senior administration official said on a call with reporters Saturday evening.
