Sectoral sanctions against Russia may create problems for Belarusian banking system

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April 22, 2016 19:18

On June 30th, 2015, the US Treasury included Belvneshekonombank in the list of organizations that are subject to sectoral sanctions envisaging a ban on access to financing by American companies and banks for a period exceeding 30 days. The Belarusian bank has received a formal ban on access to financing for a year in connection with the sanctions applied against the parent bank. As a result, the terms of settlements for the bank’s customers will be prolonged when dealing with foreign contractors in US Dollars; American companies and their representative offices in Belarus will refuse to cooperate with the bank’s clients; some large clients may transit to other banks; and there may be some problems with implementation of contracts denominated in US Dollars. In the view of further expansion of sanctions, other Belarusian banks may be included in the list, i.e. subsidiaries of Russian banks, which account for more than 20% of Belarusian banks’ assets.

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