U.S., Allies Impose Vast New Russia Sanctions Over Ukraine

New measures target Russia’s largest banks and political elite.

By , a national security and intelligence reporter at Foreign Policy.
U.S. President Joe Biden delivers remarks on Russia’s invasion of Ukraine.
U.S. President Joe Biden delivers remarks on Russia’s invasion of Ukraine.
U.S. President Joe Biden delivers remarks about Russia’s “unprovoked and unjustified” military invasion of Ukraine at the White House in Washington on Feb. 24. Drew Angerer/Getty Images

U.S. President Joe Biden announced wide-ranging new sanctions on major Russian banks and senior officials on Thursday in response to Russia’s full-scale invasion of Ukraine. Ukrainian President Volodymyr Zelensky confirmed on Thursday that 40 soldiers have been killed and dozens injured so far as Russia has pummeled military installations and airfields with cruise and ballistic missile strikes and attacked border crossings. 

Ten of Russia’s largest financial institutions will now be subject to U.S. sanctions and unprecedented export controls, which the White House projects will cut off more than half of Russia’s cutting-edge technology imports. 

Sberbank—Russia’s largest bank, which holds more than a trillion dollars in assets—is to be cut off from the U.S. financial system while the second-largest bank, VTB Bank, will be subject to full blocking sanctions, which will lock it out from using the dollar entirely. 

U.S. President Joe Biden announced wide-ranging new sanctions on major Russian banks and senior officials on Thursday in response to Russia’s full-scale invasion of Ukraine. Ukrainian President Volodymyr Zelensky confirmed on Thursday that 40 soldiers have been killed and dozens injured so far as Russia has pummeled military installations and airfields with cruise and ballistic missile strikes and attacked border crossings. 

Ten of Russia’s largest financial institutions will now be subject to U.S. sanctions and unprecedented export controls, which the White House projects will cut off more than half of Russia’s cutting-edge technology imports. 

Sberbank—Russia’s largest bank, which holds more than a trillion dollars in assets—is to be cut off from the U.S. financial system while the second-largest bank, VTB Bank, will be subject to full blocking sanctions, which will lock it out from using the dollar entirely. 

“This is going to impose severe costs on the Russian economy, both immediately and over time,” Biden said in a televised speech announcing the measures. 

For months, Washington has been sharing intelligence with its allies and partners about Moscow’s intentions as Russia amassed more than 150,000 troops on Ukraine’s borders, aiming to lay the groundwork for a unified rollout of sanctions in the event of war. 

Canadian Prime Minister Justin Trudeau announced that his country is imposing “severe sanctions” on 58 Russian elites and their families. 

Anti-corruption advocates, including Russian opposition leader Alexey Navalny, have long advocated for more forceful sanctions on Russian oligarchs and members of Russian President Vladimir Putin’s inner circle, who help shore up his authoritarian rule while enjoying luxury lifestyles in Europe and the United States. 

The United Kingdom also announced a wide range of new punitive measures on Russia, including a ban on the Russian national airline, Aeroflot; sanctions on five major defense companies; restrictions to prevent critical Russian industries from raising money in U.K. markets; and sanctions on more than 120 businesses and oligarchs. The United Kingdom is also joining the United States in sanctioning VTB Bank as well as Belarus for their role in supporting Russia’s assault on Ukraine

Speaking to British Parliament on Thursday, British Prime Minister Boris Johnson described the attack on Ukraine as a “hideous and barbarous venture.”

The European Union said it had reached an agreement on a broad package of sanctions that would target Russian financial, energy, and transport sectors, with the final details to be agreed to on Friday. “These sanctions are designed to take a heavy toll on the Kremlin’s interests and their ability to finance war,” said European Commission President Ursula von der Leyen in a statement. 

However, today’s sanctions announcements stopped short of removing Russia from SWIFT, the global messaging system that underpins much of the world’s financial transactions, in a move likely to disappoint officials in Kyiv, Ukraine’s capital. “I will not be diplomatic on this. Everyone who now doubts whether Russia should be banned from SWIFT has to understand that the blood of innocent Ukrainian men, women and children will be on their hands too,” Ukrainian Foreign Minister Dmytro Kuleba tweeted Thursday morning.

Western allies are divided over the move, which would ultimately rest with the EU as SWIFT is based in Belgium. “The sanctions that were proposed on all their banks have equal consequence—maybe more consequences—than SWIFT, number one,” Biden said. “Number two, it is always an option. But right now, that’s not the position that the rest of Europe wishes to take.” The Financial Times reported that Britain’s prime minister pushed “very hard” for Moscow to be removed from the system, whereas German Chancellor Olaf Scholz balked at the move. 

Despite months of U.S. officials warning that Russia would be subject to punishing sanctions should it invade Ukraine, Biden acknowledged after his speech that the penalties were unlikely to deter Moscow: “No one expected the sanctions to prevent anything from happening,” he said in response to questions from reporters. “Let’s have a conversation in another month or so to see if they’re working.”

Amy Mackinnon is a national security and intelligence reporter at Foreign Policy. Twitter: @ak_mack

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