Corporate Finance, DeFi, Blockchain, Web3 News
Corporate Finance, Fintech, DeFi, Blockchain, Web 3 News

Treasurers: Beware of Possible SWIFT Sanctions on Russia!

According to several media reports the UK is pressing the EU to impose a ban on Russian banks from participating in the SWIFT network. The EU has not acted on this recommendation yet, but barring any sudden reversal in policy from Mr. Putin on Ukraine, a slow ratcheting up of sanctions could likely lead to a SWIFT ban sooner rather than later.

For global enterprises, such as energy services firms with business in Russia, this could prove to be an enormously challenging issue. If you are currently moving funds through the SWIFT messaging system into or out of a Russian bank, now is the time to review those banking relationships and insure there is a contingency plan in place.

Some items to consider:
- How well capitalized is your Russian bank and can it sustain liquidity challenges with severely curtailed access to the foreign banking system?
- If you are currently sending or receiving files via SWIFT, does your bank offer a direct connection option?
- If your local Russian expenses are largely labor related, can you pay salaries and employee expenses by funding debit cards issued by your non-Russian cash management bank?

If the EU follows through with a SWIFT ban, the Russians could respond with economic sanctions of their own, providing even more urgency to review Russian bank relationships now.

Ari Morris
Founding Partner
Global Treasury Partners

Les médias du groupe Finyear

Mercredi 10 Septembre 2014