China's three largest banks have stopped accepting payments from Russian organizations
Three of the four largest banks in China have stopped accepting payments from Russian sanctioned credit institutions since the beginning of 2024. This was reported by the General Director of First Group JSC Alexey Poroshin, the commercial director of the Impaya Rus company Alexey Razumovsky, as well as an Izvestia source close to a large business association.
Restrictions were introduced by Industrial and Commercial Bank of China (ICBC), China Construction Bank (CCB) and Bank of China, which rank first, second and fourth in terms of assets in China. At the same time, the last of the listed Chinese organizations assured that they did not stop accepting payments from Russian companies in rubles and yuan.
Problems with transactions are associated with the risk of secondary sanctions
According to Poroshin, since the beginning of January, these banks have notified Russian clients that they will stop accepting payments. However, the preconditions for this problem began in the second half of December – with the entry into force of the 12th package of anti-Russian sanctions. After this, control by the US authorities increased.
Izvestia’s source in one of the Russian credit institutions stated that payments are rejected regardless of which system they go through – European SWIFT, Russian SPFS or Chinese CIPS.
The Chinese side explains the refusals by the company’s internal policy. In turn, Chairman of the Board of the National Payment Council (NPC) Association of Payment Services Market Participants Alexander Linnikov suggested that Chinese and Middle Eastern banks are afraid of secondary US sanctions due to interaction with sanctioned banks and companies from Russia.
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In January, Bloomberg sources reported that China's state-owned banks had begun reviewing their policies for working with clients from Russia and were tightening restrictions following new demands from the United States.
According to the agency's interlocutors, Chinese financial organizations want to sever ties with clients on the sanctions list and refuse to provide any services to the Russian military industry not only in dollars, but also in any other currency. They also intend to strengthen the verification of their clients for connections with Russia.
Earlier it was reported that some Chinese banks were returning payments from Russia
In early February, Deputy Chairman of the Board of SME Bank Alexey Potapov said that some Chinese banks began to return payments from Russia amid concerns about secondary Western sanctions.
He explained that the decision of Chinese credit institutions on payments from the Russian Federation largely depends on the purpose of the payment and the company performing the transaction. The risk group primarily includes transactions with sanctioned goods, such as metals and computer components, the expert said.
According to Potapov, among the organization’s clients there are companies that made payments in yuan at Chouzhou Commercial Bank. In December 2023, this Chinese bank, having received money from a Russian bank, began to return it back, he added.
The Kremlin promised to solve problems in settlements with China
On February 7, the Chinese bank Chouzhou Commercial informed clients that it had stopped operations with Russia and Belarus. In response to this, Kremlin spokesman Dmitry Peskov said that the Russian leadership is aware of the difficulties that domestic companies have begun to encounter when trying to make payments for imports from China.
According to the press secretary of the Russian President, the government is dealing with this problem in detail, because it is its prerogative. In general, he noted, the authorities are conducting a close dialogue with their partners on this issue, issues will be resolved within the framework of this dialogue.
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