“Chinese banks ‘refrained’ from dealing with Russia over sanctions fears” 11 Febraury 2024

China and Russia are in “close dialogue” over international payments processing after a Chinese bank was reported to have stopped transactions with Russia for fear it would be sanctioned.

China and Russia are in “close dialogue” over international payments processing after a Chinese bank was reported to have stopped transactions with Russia for fear it would be sanctioned...Rudenko said a number of Chinese banks had “refrained from banking activities” with Russia due to “fears of sanctions” but he did not think China would limit transactions through the Financial Messaging System, the Russian equivalent of the Swift transfer system...

Some of China’s major financial institutions have already announced plans to restrict ties with Russia since the invasion of Ukraine. Bank of China, Industrial and Commercial Bank of China and two Chinese-led development institutions – the New Development Bank and the Asian Infrastructure Investment Bank – have all reportedly restricted Russia’s access to their financing.

However, some smaller Chinese banks with no other international business ties, have been willing to finance Russia and assist in service payments...

But the role of Chinese financial institutions – especially smaller banks with no ties to places such as the US or European Union – as the main channels for Russia’s overseas activities is being tested following the introduction of further US sanctions last month...