• 20/07/2024 16:01

A Chinese bank created to work with sanctioned clients has stopped working with the Russian Federation

Russian business is unable to break through the resulting isolation after the United States promised to introduce secondary sanctions against banks working with Russia. Many had high hopes for the Chinese bank, created to work with Iran, but it also refused to accept Russian money. The Moscow Times writes about this.

The Chinese bank, created to work with sanctioned clients, has stopped working with the Russian Federation

►Subscribe to the Ministry of Finance page on Facebook: main financial news

The situation with Chinese banks

Kunlun Bank, controlled by the China National Petroleum Corporation, informed its clients that from March 29 it will completely stop process payments from Russia.

This publication was told by four Russian importers who turned to his services after Russian businesses had big problems transferring money to large Chinese banks in March.

Money in dollars, yuan, and even rubles was stuck in banks, including the state-owned Bank of China, during the week, credit institutions asked for additional documents and data, including guarantees that the purchased products would not go to the military complex and sanctioned persons, and still many ultimately refused.

According to statistics from a large customs broker, from mid-February to March, only about 25% of payments were processed by its clients in China.

Most importers have been running around banks in the last month in search of those who quickly send and receive money.

What is known about the bank

Kunlun Bank (formerly Karamay City Commercial Bank) was created in 2006, by Chinese government agencies for settlements with Iranian counterparties under sanctions, primarily due to the purchase of oil.

The bank had extensive experience working with sanctioned money. It seemed that Kunlun Bank was not afraid of secondary sanctions: since 2012, it itself has been included in the sanctions list for cooperation with Iran and is cut off from the dollar system.

“We, on the advice of our Chinese suppliers, began paying them in early March this bank and, despite the fact that all our colleagues suffered from problems with money transfers, our payments went through perfectly. But last week, the supplier said that Kunlun informed customers that it would stop accepting new payments from March 21 and that it would completely stop working with Russia from March 29,” the source told The Moscow Times.


Leave a Reply

Your email address will not be published. Required fields are marked *