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The National Bank of Ukraine (NBU) claims that the imposition of economic sanctions against Ukrainian-based subsidiaries of Russian banks will cause significant problems in the Ukrainian banking system.
"If we start applying sanctions against the Russian banks' subsidiaries here, we'll create a serious problem for ourselves. And this is what politicians and patrioteers would like to do – to confiscate, freeze [assets] and impose sanctions, but professionals are well aware that this is how we're creating our own problems," First Deputy Governor of the NBU Oleksandr Pysaruk said.
The application of sanctions will stall the sale and capitalization of financial institutions, which consequently increases risks of designating the banks as insolvent, while shareholders of Russian banks' subsidiaries in Ukraine inject significant funds into their [Ukrainian-based banks'] capital, he said.
"And if we freeze and confiscate, and make the [Individuals Deposit Guarantee] Fund handle this – who is to pay? Our Ukrainian budget. When patrioteers cry about sanctions – are they aware of what will be happening? But we are – this is our job," he said.
As UNIAN reported earlier, on September 16, Ukrainian President Petro Poroshenko enacted a decision taken by the National Security and Defense Council (NSDC) on September 2 to introduce sanctions against about 400 individuals and more than 90 entities from the Russian Federation and other countries, who are involved in the annexation of Crimea and aggression in Donbas.
As part of this decision, the NBU required banks to provide information concerning bank accounts and their balance in respect of 388 individuals and 105 entities to implement the NSDC's decision. The NBU also developed a procedure for the implementation of sanctions by banking institutions and monitoring over their implementation. This includes the seizure of assets, a ban on the establishment of business contacts, suspension of economic and financial liabilities (a ban on credits, loans, financial assistance and guarantees; prohibition to lend through the purchase of securities and to buy securities), as well as measures to prevent the withdrawal of capital from Ukraine.