Sanctions spark Russia bank run fears as country braces for ‘free fall’ in rouble
Ban on Russian banks from Swift payments network set to send currency tumbling
ByJames Titcomb27 February 2022 • 6:02pm
The Kremlin is scrambling to stave off a run on Russian banks and a crash in the rouble after Western nations announced a barrage of punishing sanctions.
Russia’s central bank said it would provide unlimited funds to the country’s lenders and dramatically expand eligibility for loans as it was forced to reassure citizens that bank cards would continue to work normally.
It came as Russians raced to cashpoints and reports of the machines running out of banknotes.
“If I were Russian, I would take my money out now. Bank runs could begin in Russia on Monday,” Bill Ackman, the star US hedge fund manager, wrote on Twitter.
Elina Ribakova, the deputy chief economist at the Institute of International Finance, said: “Bank runs have started from the very first day of sanctions and have accelerated over the weekend.”
A Western coalition of the UK, US, EU and Canada said on Saturday night they would freeze the Russian central bank’s overseas assets and cut certain Russian banks off from the Swift system for international payments, in the heaviest sanctions to date against Vladimir Putin’s regime. Japan yesterday said it would join the move to disconnect Russia from Swift.
The measures are expected to send the rouble tumbling on Monday morning, as asset restrictions limit the Bank of Russia’s ability to continue propping up the currency. Russia has $630bn (£470bn) in foreign reserves, a large portion of which is held overseas.
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Russians shared videos on social media on Sunday of long lines forming at cash points from dawn in Moscow and individuals waiting for empty machines to be refilled amid concerns that digital payments may stop working.
Economists at Evercore said that the sanctions could encourage Russia to introduce capital controls such as limiting withdrawals and the conversion of roubles into foreign currencies.
“These are actions designed to stop the ability of the CBR to support the value of the ruble and limit their support [of] other actors’ imports and debt repayments. The odds Russia turns to capital controls are increasing rapidly,” they said.
Russia’s central bank announced that it would take a series of drastic steps on Monday morning that will effectively pump unlimited liquidity into the country’s financial system.
“The Bank of Russia has the necessary resources and tools to maintain financial stability and ensure the operational continuity of the financial sector,” it said.
The central bank said Monday’s repo auction, in which it lends central bank funds out to lenders, would have no limit, having increased the limits in recent days. It also said it would expand the “Lombard list”, the type of collateral it is willing to accept, “in order to cover the possible needs of banks in current liquidity to the maximum”.
The bank sought to reassure Russians that the financial system would remain operational.
It said: “The Russian banking system is stable, has sufficient capital and liquidity to function smoothly in any situation. All customer funds on the accounts are saved and available at any time.
“Banking services are provided as usual. Bank cards of all banks in Russia also continue to work normally.” Last week, the Bank of Russia intervened in the currency markets for the first time since 2014 in an attempt to lift the rouble.
Markets are braced for a new round of turbulent trading on Monday in response to Mr Putin putting nuclear forces on alert and Germany outlining a dramatic expansion of military spending.
White House officials said the latest raft of sanctions were designed to send the rouble into “free fall” and send prices in Russia soaring.
Prominent Putin propagandist rages on live TV about losing his Italian villa – which is next to George Clooney’s – because of sanctions over Russia’s invasion of Ukraine
- Vladimir Soloviev, 58, griped about losing access to two multimillion-dollar estates he owns in Lake Como due to sanctions that followed Russian invasion
- ‘Is this the Iron Curtain?’ said journalist and Putin propogandist Vladimir Soloviev, on the set of his late-night program The Evening With Vladimir Soloviev
- Soloviev, a known anti-Ukrainian propagandist, complained about the backlash, comparing the treatment of Russians by other nations to the Cold War
- He fumed: ‘All of a sudden, now they say: “Are you Russian? Then we will close your bank account, if it’s in Europe”‘
By ALEX HAMMER FOR DAILYMAIL.COM
PUBLISHED: 15:23, 27 February 2022 | UPDATED: 18:13, 27 February 2022
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A prominent Russian TV host known for spreading anti-Ukrainian sentiment and propaganda publicly lamented losing access to his two multimillion-dollar Italian villas on TV due to sanctions spurred by Russia‘s invasion of the neighboring nation.
‘Is this the Iron Curtain?’ said journalist and Putin propogandist Vladimir Soloviev, on the set of his late-night program The Evening With Vladimir Soloviev on Friday, after learning new sanctions implemented by Italian officials would hinder his access to a pair of properties he owns off Lake Como – down the road from A-lister George Clooney.
‘I was told that Europe is a citadel of rights, that everything is permitted, that’s what they said,’ the Russian talking head, who for years has served as one of Putin’s most eminent mouthpieces, told a panel of pro-Russia pundits.
‘I know from personal experience about the so-called “sacred property rights,”‘ Soloviev, 58, asserted to the panel, who had been discussing the effects the ongoing conflict – which reached its fourth day Sunday and has left at least 245 Ukrainians dead – has had on Russian citizens.
However, upon learning the conflict would effect him and his assets personally after being hit with sanctions from Italian officials that forbid him from accessing his vacation homes – two expansive compounds valued in the tens of millions – the TV presenter went on an impassioned on-air tirade.
‘With every transaction, I was bringing paperwork demonstrating my official salary, income, I did it all,’ the host, known for condemning Europe and the West for their supposed perversion and decay, griped to his guests.
‘I bought it, paid crazy amount of taxes, I did everything. And suddenly someone makes a decision that this journalist is now on the list of sanctions. And right away it affects your real estate. Wait a minute. But you told us that Europe has sacred property rights!’
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‘Is this the Iron Curtain?’ said journalist and Putin propogandist Vladimir Soloviev, on the set of his late-night program The Evening With Vladimir Soloviev, after learning new sanctions implemented by Italian officials would hinder his access to a pair of properties he owns off Lake Como
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Pictured here is one of Soloviev’s properties, likely valued in the tens of millions. The estate boasts 14 rooms, five bedrooms, five bathrooms, a living room, a kitchen, an entrance hall, a boiler room and a pantry, as well as a 90-sq-m guest house with three guest rooms, two bathrooms, a cellar and a private, gated porch
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Pictured here is the second of Soloviev’s multimillion-dollar Italian estates, also in Lake Como
Sanctioned Russian TV host complains about losing his Italian Villa
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Taken aback by the restrictions, which officials said may evolve into the journalist losing the properties altogether if the conflict worsens, Soloviev fumed: ‘All of a sudden, now they say: “Are you Russian? Then we will close your bank account, if it’s in Europe.”‘
He went on: ‘And if it’s in England, you’re allowed to keep no more than a certain amount there. Why? Because you’re Russian,’
Renowned Russian economist Mikhail Khazin, 59, interjected: ‘And that’s if you have an old account. They won’t open a new one.’
Soloviev then offered the panel the dramatic comparison between the consequences leveled against Kremlin propogandists by countries against Russia’s occupation of the Ukraine, and the Cold War.
‘Is this the Iron Curtain?’ the host, who appeared visibly emotional during the strange appeal, asked.
Germany-based pundit Alexander Sosnovsky replied: ‘Yes, absolutely,’ before offering a contentious reclassification of the backlash Kremlin supporters are facing following their full-scale military invasion of Ukraine.
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News presenter Soloviev, one of Putin’s most used mouthpieces, complained on-air Friday about losing access to the properties as a result of sanctions imposed by Italian officials following Russia’s invasion of the Ukraine – which has already resulted in 245 Ukrainian deaths
‘The Iron Curtain in its worst manifestation,’ the commentator said. ‘Painted in LGBT colors.’
Soloviev and the other panelists proceeded to nod in agreement, without mention of the effects the ongoing military occupation has had on Ukrainian citizens.
In 2019, Soloviev and other Kremlin propagandists came under scrutiny after a report by famed Putin rival and Russian anti-corruption activist Alexei Navalny revealed the longtime NTV host had not one, but two multimillion-dollar properties just down the road from Clooney’s $100m estate on the historic Italian lake.
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In 2019, Soloviev and other Kremlin propagandists came under scrutiny after a report by a Putin opposer and Russian anti-corruption activist revealed the existence of the longtime NTV host’s multimillion-dollar properties
Last Christmas, Navalny’s investigative team, FBK, videotaped the state TV host’s luxury abodes using a combination of drones and on-foot lensman, leaving the presenter Ukrainian chocolates – a jab at Soloviev’s repeatedly recorded use of anti-Ukrainian propaganda.
Soloviev subsequently became enraged with the grass-roots activist team’s reputation-damaging report, publicly calling it an ‘outrageous privacy violation.’
Later that year, Navalny was poisoned by nerve agent, which he blamed on the Kremlin. Russian authorities denied any involvement.
Navalny subsequently spent five months recovering in Germany, but was arrested upon his return to Russia and ordered to serve 2 1/2 years in prison, for what Russian officials said was for violating the terms of a suspended sentence stemming from a 2014 fraud conviction.
He is currently serving his sentence, and has since been branded a ‘terrorist’ by the Kremlin.
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Pope Francis declares Ash Wednesday a day of fasting and prayer for peace in Ukraine
Gerard O’ConnellFebruary 23, 2022
Worshippers light candles as they attend a prayer service at St. Michael’s Cathedral of the Orthodox Church of Ukraine in Kyiv Feb. 20, 2022. (CNS photo/Umit Bektas, Reuters)
Pope Francis made a heartfelt appeal for peace in Ukraine at his public audience in the Vatican on Feb. 23 as the situation continued to deteriorate between Russia and Ukraine. He appealed to the consciences of “those with political responsibility” and “all the parties involved” to “refrain from any action that would cause even more suffering to the people, destabilizing coexistence between nations and bringing international law into disrepute.”
He also appealed “to everyone, believers and nonbelievers alike” to make March 2—Ash Wednesday—“a day of prayer and fasting for peace.”
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Francis looked distressed, his voice betraying emotion, as he addressed hundreds of pilgrims from around the world in the Vatican’s Paul VI Audience Hall this morning. He had been briefed on the alarming crisis and the threat that Russia would invade Ukraine, a nation of 44 million people that gained its independence in 1991 following the collapse of the Soviet Union. Ukraine is the second-largest country in Europe by area, after Russia.
On Monday, Feb. 21, Vladimir Putin, the president of the Russian Federation, announced that his country was recognizing two breakaway republics—Donetsk and Lukarsk—in the Donbas region in the southeastern part of Ukraine that shares a border with Russia. The two republics have a predominantly ethnically Russian population. President Putin’s decision, in violation of international law, drew widespread condemnation from most countries in the world and risked sparking a war if, as he promised, he were to send Russian troops into the two republics “to protect the peace.” Already more than 150,000 Russian troops, aircraft and naval vessels are amassed around Ukraine, including 30,000 in Belarus in what is now the largest gathering of the military forces in Europe since World War II.
Francis looked distressed, his voice betraying emotion, as he addressed hundreds of pilgrims from around the world in the Vatican’s Paul VI Audience Hall this morning.
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The Russian president wants Ukraine to formally agree not to join NATO nor host weapons that could be a threat to his country. He also wants Ukraine and the international community to accept that the two breakaway republics are no longer part of Ukraine.
Mr. Putin’s decision has already caused the United States, the United Kingdom and the 27 countries of the European Union to impose a first round of economic sanctions on Russia, with the promise of even stronger sanctions if Russia invades Ukraine. The crisis has caused turbulence in international markets and is provoking a rise in the price of gas, oil and other commodities.
“My heart aches greatly at the worsening situation in Ukraine,” Pope Francis remarked today. “Despite the diplomatic efforts of the last few weeks, increasingly alarming scenarios are opening up,” he said, “and like me, many people all over the world are feeling anguish and concern. Once again the peace of all is threatened by partisan interests.”
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[Related: 10 ways to avoid a devastating war in Ukraine]
For weeks now, diplomatic efforts involving European leaders from Germany, France and Britain, as well as from the United States, have failed to work out a diplomatic solution to the crisis. Yesterday, diplomatic efforts seemed to collapse with the decision of U.S. Secretary of State Antony Blinken and President Joe Biden not to meet with their Russian counterparts.
Today, Pope Francis made a personal plea to political leaders, saying, “I would like to appeal to those with political responsibility to examine their consciences seriously before God, who is the God of peace and not of war; who is the Father of all, not just of some, who wants us to be brothers and not enemies.”
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“Jesus taught us that the diabolical senselessness of violence is answered with God’s weapons, with prayer and fasting,” the pope said
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Pope Francis called on all people, “believers and nonbelievers alike,” to pray and fast for peace next Wednesday, March 2, which for most Christians is also Ash Wednesday and the beginning of Lent. “Jesus taught us that the diabolical senselessness of violence is answered with God’s weapons, with prayer and fasting,” the pope said. “I encourage believers in a special way to dedicate themselves intensely to prayer and fasting on that day.”
He concluded with a prayer: “May the Queen of Peace preserve the world from the madness of war.”
Meanwhile in Kyiv, the capital of Ukraine, a city of 2.8 million people, the Major Archbishop of the country’s Greek-Catholic Church, His Beatitude Sviatoslav Shevchuk, in a message made public today, denounced Russia’s violation of international law by recognizing the two breakaway republics and called on his fellow Ukrainian citizens to defend their country. He said: “To defend our fatherland is our natural right and our civic duty. We are strong when we stand together. The moment has now arrived to unite our forces to defend the independence, the territorial integrity and the sovereignty of the [Ukrainian] state. It is the duty and responsibility of all humanity to commit itself today to prevent the war and [to] protect a just peace.”
The president of the Polish bishops’ conference, Archbishop Stanislaw Gadeckis, sent a letter to Christian leaders in Russia and Ukraine calling on them to join in prayer for peace. He recalled that Poland, Russia and Ukraine have “a common history and Christian faith” and should “tend not to hatred, but to mutual respect and friendship.”
Archbishop Gadeckis also called on Catholics and people of goodwill in Poland to welcome Ukrainian refugees seeking shelter in the country. “Everyone has the right to live in peace and security,” the archbishop wrote. “Everyone has the right to seek, for themselves and their loved ones, safe living conditions.”
More: POPE FRANCIS / WAR & PEACE / RUSSIA / EUROPE
Gerard O’Connell is America’s Vatican correspondent and author of The Election of Pope Francis: An Inside Story of the Conclave That Changed History. He has been covering the Vatican since 1985.
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