Nations pledge to remove ‘selected’ Russian banks from Swift system

The US, European Union and UK have agreed to block “selected” Russian banks from the Swift global financial messaging system in retaliation for the Russian invasion of Ukraine.

“Restrictive measures” will also be imposed on Russia’s central bank.

The measures were announced jointly as part of a new round of financial sanctions meant to impose a severe cost on Russia for the invasion.

The Swift financial system moves countless billions of dollars around more than 11,000 banks and other financial institutions around the world every day.

Allies on both sides of the Atlantic had considered the Swift option in 2014, when Russia invaded and annexed Ukraine’s Crimea and backed separatist forces in eastern Ukraine.

Russia declared then that kicking it out of Swift would be equivalent to a declaration of war.

The allies – criticised ever since for responding too weakly to Russia’s 2014 aggression – shelved the idea. Russia since then has tried to develop its own financial transfer system, with limited success.

The US has succeeded before in persuading the Belgium-based Swift system to kick out a country – Iran, over its nuclear programme.

But kicking Russia out of Swift would also hurt other economies, including those of the US and key ally Germany.

The disconnection from Swift announced by the West on Saturday is partial, leaving Europe and the United States room to escalate penalties further later.

In Brussels, EU Commission president Ursula von der Leyen said cutting several commercial banks from Swift “will ensure that these banks are disconnected from the international financial system and harm their ability to operate globally”.

She said more banks could be hit “as appropriate”.

Ms von der Leyen said the EU would “commit to taking measures to limit the sale of citizenship – so-called golden passports – that let wealthy Russians connected to the Russian government become citizens of our countries and gain access to our financial systems”.