(Adds Sberbank comment)
KIEV, March 15 Ukraine will impose sanctions on
the Ukrainian subsidiaries of Russian state-owned banks, the
central bank said on Wednesday, part of a wider crackdown over
increased tensions in eastern separatist regions.
The restrictions will ban the banks from taking money out of
Ukraine, Kateryna Rozhkova, a deputy central bank chief, told
journalists in a briefing.
Five Russian state-owned banks are present in Ukraine with a
combined market share of 8.6 percent and liabilities of 36
billion hryvnia ($1.3 billion). Sberbank, VEB and VTB
are among the top 20 largest lenders.
The banks have already been banned from increasing their
assets and deposits following a breakdown in relations between
Ukraine and Russia in 2014 due to Moscow's annexation of Crimea
and support for pro-Russian separatists.
"These banks have a high level of debt to their parent
structures. Sanctions prevent these debts being paid," Rozhkova
Sberbank's press office said it could not comment fully
until the decision was finalised, but expressed hope that
Ukraine's authorities would show "wisdom and foresight."
The new sanctions were requested by Ukraine's Security and
Defence Council, which earlier on Wednesday also halted all
cargo traffic with rebel-held territory, formalising an existing
rail blockade that has fuelled the worst political crisis in
nearly a year.
Increased political tension and a flare-up in the eastern
conflict earlier in 2017 has prompted activists to protest
against the continued presence of Russian banks in Ukraine.
On Monday, Sberbank said it was concerned by the protests,
which included a nationalist group walling up the entrance to
one of its branches in Kiev with masonry and cement.
The latest restrictions do not apply to private banks that
operate in both Ukraine and Russia, such as Alfa Bank and
Ukrsotsbank, which account for 7 percent of assets in Ukraine's
Rozhkova said the sanctioned banks' liabilities were
completely covered by their assets and the restrictions would
not prevent the lenders being sold.
VEB and VTB are already in talks to sell their Ukrainian
($1 = 26.8500 hryvnias)
(Reporting by Pavel Polityuk; Additional reporting by Kira
Zavyalova and Alexander Winning in Moscow; Writing by Alessandra
Prentice; Editing by Alison Williams and Toby Davis)