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 Two Russian banks hit hardest by U.S. sanctions over Ukraine - The Wall Street Journal

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Banks controlled by three billionaire friends of Russian President Vladimir Putin have seen about $640 million of assets frozen in the U.S. as retaliation for the Kremlin’s actions in Ukraine, according to U.S. government records.

Censor.NET reports citing The Wall Street Journal.

The figures, not previously reported, show the surprising extent to which the economic sanctions imposed by the U.S. have pinched the pockets of some of Russia's most politically connected firms.

Hit the hardest is Bank Rossiya, which had at least $572 million blocked in U.S. accounts, according to records released to The Wall Street Journal by the Treasury Department. That is equivalent to roughly 10% of its 2013 assets, at today's exchange rate.

The St. Petersburg bank, whose founder Yuri Kovalchuk is alleged by the U.S. to be one of Mr. Putin's "cashiers," was described by the Obama administration as a personal bank for senior Russian officials.

Also hit is SMP Bank, majority-owned by Arkady and Boris Rotenberg, two brothers who are childhood friends and former judo partners of Mr. Putin. They have amassed some of Russia's biggest fortunes, built in part on lucrative contracts with the state and state-owned companies.

Read also: EU ready for new sanctions against Russia if Minsk agreements do not work - Merkel

Their bank has had at least $65 million-equal to about 2% of 2013 assets-blocked across dozens of accounts in U.S. financial institutions, Treasury documents show.

Dozens of other Russian firms have been ensnared in U.S. sanctions, including a prominent weapons manufacturer. But none comes close to those amounts, reflecting the two banks' exposure to Western money channels.

The figures also highlight the limited reach of such targeted sanctions-at least relative to the immense fortunes amassed by Russian oligarchs.

The Obama administration and the European Union have imposed several rounds of sanctions since the conflict in Ukraine began. Some mandated visa restrictions and the freezing of individual or company assets, while others sought to restrict Russian access to Western financing or technology.

Read also: Warsaw to decide lethal aid to Ukraine in coming days - Polish General Staff

The idea was to penalize the Kremlin's inner circle and increase the pressure on Mr. Putin to change course. Yet, nearly a year after the Kremlin grabbed Crimea from Ukraine, there is no evidence the strategy has substantially affected Mr. Putin's calculus.

Even as Western sanctions help push the Russian economy toward recession, Western officials say Moscow has continued to support and arm separatists in eastern Ukraine in a fight that has claimed some 6,000 lives.

Read also: NATO: Russian regular soldiers 'dying in large numbers' in Ukraine

 
 
 
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