PUTIN Economics
Sanctions spark Russia bank run fears as country braces for ‘free fall’ in rouble
Ban on Russian banks from Swift payments network set to send currency tumbling
ByJames Titcomb27 February 2022 • 6:02pm
The Kremlin is scrambling to stave off a run on Russian banks and a crash in the rouble after Western nations announced a barrage of punishing sanctions.
Russia’s central bank said it would provide unlimited funds to the country’s lenders and dramatically expand eligibility for loans as it was forced to reassure citizens that bank cards would continue to work normally.
It came as Russians raced to cashpoints and reports of the machines running out of banknotes.
“If I were Russian, I would take my money out now. Bank runs could begin in Russia on Monday,” Bill Ackman, the star US hedge fund manager, wrote on Twitter.
Elina Ribakova, the deputy chief economist at the Institute of International Finance, said: “Bank runs have started from the very first day of sanctions and have accelerated over the weekend.”
A Western coalition of the UK, US, EU and Canada said on Saturday night they would freeze the Russian central bank’s overseas assets and cut certain Russian banks off from the Swift system for international payments, in the heaviest sanctions to date against Vladimir Putin’s regime. Japan yesterday said it would join the move to disconnect Russia from Swift.
The measures are expected to send the rouble tumbling on Monday morning, as asset restrictions limit the Bank of Russia’s ability to continue propping up the currency. Russia has $630bn (£470bn) in foreign reserves, a large portion of which is held overseas.
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Russians shared videos on social media on Sunday of long lines forming at cash points from dawn in Moscow and individuals waiting for empty machines to be refilled amid concerns that digital payments may stop working.
Economists at Evercore said that the sanctions could encourage Russia to introduce capital controls such as limiting withdrawals and the conversion of roubles into foreign currencies.
“These are actions designed to stop the ability of the CBR to support the value of the ruble and limit their support [of] other actors’ imports and debt repayments. The odds Russia turns to capital controls are increasing rapidly,” they said.
Russia’s central bank announced that it would take a series of drastic steps on Monday morning that will effectively pump unlimited liquidity into the country’s financial system.
“The Bank of Russia has the necessary resources and tools to maintain financial stability and ensure the operational continuity of the financial sector,” it said.
The central bank said Monday’s repo auction, in which it lends central bank funds out to lenders, would have no limit, having increased the limits in recent days. It also said it would expand the “Lombard list”, the type of collateral it is willing to accept, “in order to cover the possible needs of banks in current liquidity to the maximum”.
The bank sought to reassure Russians that the financial system would remain operational.
It said: “The Russian banking system is stable, has sufficient capital and liquidity to function smoothly in any situation. All customer funds on the accounts are saved and available at any time.
“Banking services are provided as usual. Bank cards of all banks in Russia also continue to work normally.” Last week, the Bank of Russia intervened in the currency markets for the first time since 2014 in an attempt to lift the rouble.
Markets are braced for a new round of turbulent trading on Monday in response to Mr Putin putting nuclear forces on alert and Germany outlining a dramatic expansion of military spending.
White House officials said the latest raft of sanctions were designed to send the rouble into “free fall” and send prices in Russia soaring.
Prominent Putin propagandist rages on live TV about losing his Italian villa – which is next to George Clooney’s – because of sanctions over Russia’s invasion of Ukraine
- Vladimir Soloviev, 58, griped about losing access to two multimillion-dollar estates he owns in Lake Como due to sanctions that followed Russian invasion
- ‘Is this the Iron Curtain?’ said journalist and Putin propogandist Vladimir Soloviev, on the set of his late-night program The Evening With Vladimir Soloviev
- Soloviev, a known anti-Ukrainian propagandist, complained about the backlash, comparing the treatment of Russians by other nations to the Cold War
- He fumed: ‘All of a sudden, now they say: “Are you Russian? Then we will close your bank account, if it’s in Europe”‘
By ALEX HAMMER FOR DAILYMAIL.COM
PUBLISHED: 15:23, 27 February 2022 | UPDATED: 18:13, 27 February 2022
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A prominent Russian TV host known for spreading anti-Ukrainian sentiment and propaganda publicly lamented losing access to his two multimillion-dollar Italian villas on TV due to sanctions spurred by Russia‘s invasion of the neighboring nation.
‘Is this the Iron Curtain?’ said journalist and Putin propogandist Vladimir Soloviev, on the set of his late-night program The Evening With Vladimir Soloviev on Friday, after learning new sanctions implemented by Italian officials would hinder his access to a pair of properties he owns off Lake Como – down the road from A-lister George Clooney.
‘I was told that Europe is a citadel of rights, that everything is permitted, that’s what they said,’ the Russian talking head, who for years has served as one of Putin’s most eminent mouthpieces, told a panel of pro-Russia pundits.
‘I know from personal experience about the so-called “sacred property rights,”‘ Soloviev, 58, asserted to the panel, who had been discussing the effects the ongoing conflict – which reached its fourth day Sunday and has left at least 245 Ukrainians dead – has had on Russian citizens.
However, upon learning the conflict would effect him and his assets personally after being hit with sanctions from Italian officials that forbid him from accessing his vacation homes – two expansive compounds valued in the tens of millions – the TV presenter went on an impassioned on-air tirade.
‘With every transaction, I was bringing paperwork demonstrating my official salary, income, I did it all,’ the host, known for condemning Europe and the West for their supposed perversion and decay, griped to his guests.
‘I bought it, paid crazy amount of taxes, I did everything. And suddenly someone makes a decision that this journalist is now on the list of sanctions. And right away it affects your real estate. Wait a minute. But you told us that Europe has sacred property rights!’
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‘Is this the Iron Curtain?’ said journalist and Putin propogandist Vladimir Soloviev, on the set of his late-night program The Evening With Vladimir Soloviev, after learning new sanctions implemented by Italian officials would hinder his access to a pair of properties he owns off Lake Como
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Pictured here is one of Soloviev’s properties, likely valued in the tens of millions. The estate boasts 14 rooms, five bedrooms, five bathrooms, a living room, a kitchen, an entrance hall, a boiler room and a pantry, as well as a 90-sq-m guest house with three guest rooms, two bathrooms, a cellar and a private, gated porch
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Pictured here is the second of Soloviev’s multimillion-dollar Italian estates, also in Lake Como
Sanctioned Russian TV host complains about losing his Italian Villa
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Taken aback by the restrictions, which officials said may evolve into the journalist losing the properties altogether if the conflict worsens, Soloviev fumed: ‘All of a sudden, now they say: “Are you Russian? Then we will close your bank account, if it’s in Europe.”‘
He went on: ‘And if it’s in England, you’re allowed to keep no more than a certain amount there. Why? Because you’re Russian,’
Renowned Russian economist Mikhail Khazin, 59, interjected: ‘And that’s if you have an old account. They won’t open a new one.’
Soloviev then offered the panel the dramatic comparison between the consequences leveled against Kremlin propogandists by countries against Russia’s occupation of the Ukraine, and the Cold War.
‘Is this the Iron Curtain?’ the host, who appeared visibly emotional during the strange appeal, asked.
Germany-based pundit Alexander Sosnovsky replied: ‘Yes, absolutely,’ before offering a contentious reclassification of the backlash Kremlin supporters are facing following their full-scale military invasion of Ukraine.
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News presenter Soloviev, one of Putin’s most used mouthpieces, complained on-air Friday about losing access to the properties as a result of sanctions imposed by Italian officials following Russia’s invasion of the Ukraine – which has already resulted in 245 Ukrainian deaths
‘The Iron Curtain in its worst manifestation,’ the commentator said. ‘Painted in LGBT colors.’
Soloviev and the other panelists proceeded to nod in agreement, without mention of the effects the ongoing military occupation has had on Ukrainian citizens.
In 2019, Soloviev and other Kremlin propagandists came under scrutiny after a report by famed Putin rival and Russian anti-corruption activist Alexei Navalny revealed the longtime NTV host had not one, but two multimillion-dollar properties just down the road from Clooney’s $100m estate on the historic Italian lake.
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In 2019, Soloviev and other Kremlin propagandists came under scrutiny after a report by a Putin opposer and Russian anti-corruption activist revealed the existence of the longtime NTV host’s multimillion-dollar properties
Last Christmas, Navalny’s investigative team, FBK, videotaped the state TV host’s luxury abodes using a combination of drones and on-foot lensman, leaving the presenter Ukrainian chocolates – a jab at Soloviev’s repeatedly recorded use of anti-Ukrainian propaganda.
Soloviev subsequently became enraged with the grass-roots activist team’s reputation-damaging report, publicly calling it an ‘outrageous privacy violation.’
Later that year, Navalny was poisoned by nerve agent, which he blamed on the Kremlin. Russian authorities denied any involvement.
Navalny subsequently spent five months recovering in Germany, but was arrested upon his return to Russia and ordered to serve 2 1/2 years in prison, for what Russian officials said was for violating the terms of a suspended sentence stemming from a 2014 fraud conviction.
He is currently serving his sentence, and has since been branded a ‘terrorist’ by the Kremlin.
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