Chinese bank halts transactions with sanctioned Russian banks

The Russian subsidiary of the Bank of China, the Chinese banking giant that facilitates yuan payments between Russia and China, has suspended operations with Russian banks included in the US Specially Designated Nationals (SDN) List. However, the bank will continue working with non-sanctioned Russian financial institutions, as reported by several sources in the financial market to the Russian newspaper Kommersant.

According to Report, experts estimate that Bank of China's Russian unit handled a substantial portion of payment traffic between the two countries, although the bank has recently shifted more towards non-bank intermediaries. The decision to halt transactions with sanctioned banks is attributed to fears of secondary sanctions from the United States.

According to earlier reports, the US has been working on imposing sanctions against several Chinese banks, with Chinese entities and individuals regularly finding themselves targeted by American sanctions related to Russia over the past six months, including in the latest round of restrictions announced on June 12.