Apple was among the large US companies to announce moves to exit or freeze business in Russia (AFP/Chris DELMAS) (Chris DELMAS)
Tue, March 1, 2022
Apple, ExxonMobil and Boeing announced Tuesday in rapid succession steps to withdraw or freeze business in Russia as more US corporate giants take action after the Ukraine invasion.
The moves -- in diverse industries and following earlier announcements by Disney, Ford, Mastercard and others -- highlight the rising economic toll on Russia after its assault on Ukraine unleashed massive sanctions across Western governments.
ExxonMobil will begin a phased withdrawal from the giant Sakhalin offshore oilfield that it has operated since 1995, saying "we deplore Russia's military action that violates the territorial integrity of Ukraine and endangers its people."
The US company operates in Russia on behalf of a consortium including Russian, Indian and Japanese companies, its only major project in Russia, after it pulled out of two joint ventures during the previous round of sanctions against Russia following its annexation of Crimea in 2014.
ExxonMobil's move follows earlier decisions by British energy group BP and Shell to pull out of joint projects in Russia. France's TotalEnergies said it would stay in Russia, but refrain from investing more money there.
ExxonMobil stressed that "the process to discontinue operations will need to be carefully managed and closely coordinated with the co-venturers in order to ensure it is executed safely."
- Focus on security of staff -
Earlier, Apple said it would halt all product sales in Russia and limit the use of Apple Pay and other services in the country.
"We are deeply concerned about the Russian invasion of Ukraine and stand with all of the people who are suffering as a result of the violence," Apple said.
Ukraine's defiant government, which has urged its people to battle Russian forces, has asked for help from all quarters, including Apple's CEO Tim Cook.
"I appeal to you... to stop supplying Apple services and products to the Russian Federation, including blocking access to the Apple Store!" Ukraine's digital minister Mykhailo Fedorov wrote in a letter he posted to Twitter Friday.
Boeing for its part said it was suspending its support for Russian airlines and its operations in Moscow, saying it was "focused on ensuring the safety of our teammates in the region."
The action could weigh heavily on flag carrier Aeroflot, which flies the Boeing 737 and 777, and last week announced it was suspending flights to Europe in response to the flight ban.
The United States and European allies have put tough sanctions on Moscow in recent days, including by cutting selected Russian banks from the SWIFT messaging system, while Washington has announced measures specifically targeting the country's central bank.
There has also been a stampede of large US companies in recent days away from Russia affecting nearly every sector.
Disney and WarnerMedia were among the entertainment giants to suspend new film releases in Russia, while tech heavyweights such as Facebook, TikTok and Microsoft moved to curb the reach of Russian state-linked news outlets, which stand accused of pushing misinformation about Moscow's invasion of Ukraine.
General Motors suspended vehicle exports to Russia, while Detroit rival Ford aid it was suspending its remaining operations in Russia, including commercial van manufacturing.
Credit card companies including Visa, Mastercard and American Express announced they were blocking Russian banks from their payment networks following international sanctions.
On Tuesday, Moscow announced plans for presidential decree aimed at preventing foreign investment exiting the country.
"In the current sanctions situation, foreign investors will be guided not by economic factors, but by political pressure," Prime Minister Mikhail Mishustin said.
"To enable businesses to make informed decisions, a draft presidential decree has been prepared to introduce temporary restrictions on exiting Russian assets."
He added: "We still consider foreign business as potential partners."
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European subsidiary of Russia's Sberbank
to enter bankruptcy
Western sanctions were levelled against the bank in response to Moscow's invasion of Ukraine (AFP/Jure Makovec) (Jure Makovec)
Tue, March 1, 2022
The European subsidiary of Russia's Sberbank will be wound up after coming under pressure from Western sanctions levelled against the bank in response to Moscow's invasion of Ukraine, European banking regulators said Tuesday.
The Austrian subsidiary of Russia's biggest lender Sberbank Europe AG would be allowed to enter "normal insolvency proceedings" while branches in Croatia and Slovenia were sold to local banks, the Single Resolution Board, part of the European Union's system to maintain financial stability, said in a statement.
Depositors at the Austrian subsidiary would be protected up to 100,000 euros ($111,265), in line with European legislation, while those in Croatia and Slovenia would be covered "with no limits".
Sberbank AG suffered financing issues following the announcement of tough European Union sanctions aimed at choking off Russian banks' access to capital markets.
The European Central Bank reported Monday that the European affiliate was "failing or likely to fail" after it "experienced significant deposit outflows as a result of the reputational impact of geopolitical tensions".
Support for the Austrian subsidiary from its parent was not possible since the Russian central bank prohibits financial institutions from sending cash to countries that have imposed sanctions.
Sberbank Europe AG -- which is 100 percent owned by the bank's Russian parent company -- also has subsidiaries in Bosnia and Herzegovina, the Czech Republic, Hungary and Serbia, which are not overseen by European regulators.
In the case of the Austrian subsidiary, the SRB determined letting the bank fail would "not have a negative impact on financial stability". The subsidiaries in Croatia and Slovenia would open again as normal on Wednesday.
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Western sanctions were levelled against the bank in response to Moscow's invasion of Ukraine (AFP/Jure Makovec) (Jure Makovec)
Tue, March 1, 2022
The European subsidiary of Russia's Sberbank will be wound up after coming under pressure from Western sanctions levelled against the bank in response to Moscow's invasion of Ukraine, European banking regulators said Tuesday.
The Austrian subsidiary of Russia's biggest lender Sberbank Europe AG would be allowed to enter "normal insolvency proceedings" while branches in Croatia and Slovenia were sold to local banks, the Single Resolution Board, part of the European Union's system to maintain financial stability, said in a statement.
Depositors at the Austrian subsidiary would be protected up to 100,000 euros ($111,265), in line with European legislation, while those in Croatia and Slovenia would be covered "with no limits".
Sberbank AG suffered financing issues following the announcement of tough European Union sanctions aimed at choking off Russian banks' access to capital markets.
The European Central Bank reported Monday that the European affiliate was "failing or likely to fail" after it "experienced significant deposit outflows as a result of the reputational impact of geopolitical tensions".
Support for the Austrian subsidiary from its parent was not possible since the Russian central bank prohibits financial institutions from sending cash to countries that have imposed sanctions.
Sberbank Europe AG -- which is 100 percent owned by the bank's Russian parent company -- also has subsidiaries in Bosnia and Herzegovina, the Czech Republic, Hungary and Serbia, which are not overseen by European regulators.
In the case of the Austrian subsidiary, the SRB determined letting the bank fail would "not have a negative impact on financial stability". The subsidiaries in Croatia and Slovenia would open again as normal on Wednesday.
sea/jfx
Visa, Mastercard block Russian financial institutions after sanctions
Maria Ponnezhath
Mon., February 28, 2022
FILE PHOTO: Illustration photo of a Mastercard logo on a credit card
By Maria Ponnezhath
(Reuters) -U.S. payment card firms Visa Inc and Mastercard Inc have blocked multiple Russian financial institutions from their network, complying with government sanctions imposed over Moscow's invasion of Ukraine.
Visa said on Monday it was taking prompt action to ensure compliance with applicable sanctions, adding that it will donate $2 million for humanitarian aid. Mastercard also promised to contribute $2 million.
"We will continue to work with regulators in the days ahead to abide fully by our compliance obligations as they evolve," Mastercard said in a separate statement late on Monday.
In 2021, about 4% of Mastercard's net revenues were derived from business conducted within, into and out of Russia. Meanwhile, business conducted within, into and out of Ukraine accounted for 2% of its net revenues, according to a filing on Tuesday.
The government sanctions require Visa to suspend access to its network for entities listed as Specially Designated Nationals, a source familiar with the matter told Reuters. The United States has added various Russian financial firms to the list, including the country's central bank and second-largest lender VTB.
On Saturday, the U.S., Britain, Europe and Canada announced new sanctions on Russia - including blocking certain lenders' access to the SWIFT international payment system.
Russians rushed to ATMs and waited in long queues on Sunday and Monday amid concerns that bank cards may cease to function, or that banks would limit cash withdrawals.
Russia calls its actions in Ukraine a "special operation".
Many Western banks, airlines and more have cut ties with Russia, calling the country's actions unacceptable. European nations and Canada have shut their airspace to Russian aircraft.
(Reporting by Maria Ponnezhath in Bengaluru; Editing by Christian Schmollinger, Kenneth Maxwell, Kirsten Donovan)
Maria Ponnezhath
Mon., February 28, 2022
FILE PHOTO: Illustration photo of a Mastercard logo on a credit card
By Maria Ponnezhath
(Reuters) -U.S. payment card firms Visa Inc and Mastercard Inc have blocked multiple Russian financial institutions from their network, complying with government sanctions imposed over Moscow's invasion of Ukraine.
Visa said on Monday it was taking prompt action to ensure compliance with applicable sanctions, adding that it will donate $2 million for humanitarian aid. Mastercard also promised to contribute $2 million.
"We will continue to work with regulators in the days ahead to abide fully by our compliance obligations as they evolve," Mastercard said in a separate statement late on Monday.
In 2021, about 4% of Mastercard's net revenues were derived from business conducted within, into and out of Russia. Meanwhile, business conducted within, into and out of Ukraine accounted for 2% of its net revenues, according to a filing on Tuesday.
The government sanctions require Visa to suspend access to its network for entities listed as Specially Designated Nationals, a source familiar with the matter told Reuters. The United States has added various Russian financial firms to the list, including the country's central bank and second-largest lender VTB.
On Saturday, the U.S., Britain, Europe and Canada announced new sanctions on Russia - including blocking certain lenders' access to the SWIFT international payment system.
Russians rushed to ATMs and waited in long queues on Sunday and Monday amid concerns that bank cards may cease to function, or that banks would limit cash withdrawals.
Russia calls its actions in Ukraine a "special operation".
Many Western banks, airlines and more have cut ties with Russia, calling the country's actions unacceptable. European nations and Canada have shut their airspace to Russian aircraft.
(Reporting by Maria Ponnezhath in Bengaluru; Editing by Christian Schmollinger, Kenneth Maxwell, Kirsten Donovan)
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