BNR – HSBC announced that it will cease facilitating commercial payments between business customers involving Russia and Belarus. Indeed, HSBC Bank is one of the world’s largest and most globally influential banks.
This decision reflects an expansion of restrictions beyond the sanctions initially imposed following Russia’s invasion of Ukraine.
The bank, with a significant presence across China, the United States, and Europe, has encountered mounting challenges.
This is due to the escalating sanctions and constraints placed on Russia and its ally Belarus by the international community.
An HSBC spokesperson stated that the sanctions enacted globally against Russia and Belarus have rendered our operations increasingly complex.
Furthermore, HSBC has told its business customers that it will no longer process commercial payments related to Russia and Belarus. Additionally, this policy is set to take effect globally starting this month.
Reportedly, customers in Hong Kong have been informed that the restrictions will be enforced from 27 October.
While HSBC had previously announced its intention to exit the Russian market, the sale of its Russian unit to local bank Expobank has faced delays and awaits final regulatory approval.
HSBC and Western Banks Navigate Complex Relations
This action by HSBC is part of a broader trend of Western institutions restricting financial interactions with Russia.
In response to Russia’s invasion of Ukraine, several Russian banks were denied access to the international SWIFT payments system.
In turn, this has forced entities like Sberbank and VTB to curtail their operations in many European countries.
Western governments also froze approximately $300 billion of the Russian central bank’s reserves.
Despite these measures, not all economic ties with Russia have been severed, and some trade activities, albeit reduced, persist.
Certain European banks, including UniCredit and Raiffeisen Bank International, maintain significant business operations in Russia.
The United States has advocated for more stringent actions against banks with ties to Russia. However, China has taken a contrasting approach by deepening its economic relationships with the country.