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Russia-Ukraine latest news: Western allies to cut some Russian banks out of Swift payments system – live
US, UK and EU, including Germany, sign joint statement saying they want to cut institutions off from ‘international financial system’
21m ago
17:48
The news that western allies will ban Russian banks from the Swift global payments network is a break through for the countries that had initially pushed for the ban.
The UK and Spain were early supporters of the move to lock Russia out of Swift, the main secure messaging system that banks use to make rapid and secure cross-border payments, but Germany was a key holdout.
On Saturday, however, Annalena Baerbock, Germany’s foreign minister, said the country was working on a “targeted and functional restriction” on Swift. Hours later, the joint statement by western allies, including Germany, was released, with EU Commission president Ursula von der Leyen announcing the measure.
It is a victory for Ukraine, which had pleaded since Thursday for countries to ban Russia – foreign minister Dmytro Kuleba going so far as to say that European and US politicians would have “blood on their hands” if they did not.
But it remains unclear how widespread the ban will be. The statement from the west referred to removing “selected Russian banks” from Swift, but gave no specifics.
The US, like Germany, had initially been sceptical about the Swift ban. The Observer’s economics editor, Phillip Inman, wrote that “one reason is that the impact on Russian businesses might not be so serious”:
The head of a large Russian bank, VTB, said recently he could use other channels for payments, such as phones, messaging apps or email. Russian banks could also route payments via countries that have not imposed sanctions, such as China, which has set up its own payments system to rival Swift.
Updated at 5.53pm ES
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