US Allies Escalate Financial War Against Putin, Freeze Russian Central Bank Foreign Reserves

As reports of military action and casualties mount following Russia’s invasion of Ukraine, a parallel ‘financial war’ is also escalating that is aimed at isolating Moscow through a growing list of economic sanctions.

In a joint communique released Saturday by the European Commission, France, Germany, Italy, the United Kingdom, Canada, and the United States, the group condemned “Putin’s war of choice” while outlining further restrictive economic measures, including the freezing of an estimated $630 billion in foreign reserve assets held overseas by the Central Bank of Russia.

The five-pronged weekend action also includes plans to block select Russian banks and wealthy individuals from accessing the SWIFT global payments and messaging network, after initial financial sanctions were levied last week.

“We commit to imposing restrictive measures that will prevent the Russian Central Bank from deploying its international reserves in ways that undermine the impact of our sanctions,” the statement said, noting the creation of a transatlantic task force that will limit citizenship and impede other attempts to access the western financial system.

The White House statement pointed to the “severe measures” that were imposed on Russian institutions and banks last week, as well as on Russian President Vladimir Putin, but as Russian forces continued their assault, global leaders agreed it was time to take further action.

“We are resolved to continue imposing costs on Russia that will further isolate Russia from the international financial system and our economies,”  the statement read.

See also: Why Removing Russia From SWIFT Won’t Be Simple

The plan is to implement the measures in the upcoming days, starting with blocking Russian banks, at least partially, from SWIFT, the main way to conduct financial transactions worldwide.

“This will ensure that these banks are disconnected from the international financial system and harm their ability to operate globally,” per the statement. However, SWIFT was instructed to leave some Russian banks on the system to ensure the EU had a channel for energy payments and other critical transactions, the WSJ reported, noting the region’s reliance on Russian oil and natural gas for heat and electricity.

Read more: Russia Remains on SWIFT Over Fears of New Payments System

E.C. President Ursula von der Leyen said the EU would kick several banks in Russia off the SWIFT network, the WSJ reported.

“This will ensure that these banks are disconnected from the international financial system and harm their ability to operate globally,” von der Leyen said, of a collective response that geopolitical commentators have likened to those sanctions placed on North Korea and Iran.