The largest Russian bank, state-owned Sberbank of Russia, despite its repeated public statements about a lack of intentions to operate in the Russian-occupied Ukrainian region of Crimea, is massively issuing mortgages to purchase real estate in the occupied peninsula, according to the Ukrainian-language report "Crimean Banking System: What is Actually Happening on the Occupied Peninsula compiled by the Monitoring Group of BlackSeaNews and the Institute of Black Sea Strategic Studies.
The reason for the bank's covert tactics in Crimea is Sberbank management's hope to avoid harsher Western sanctions. Currently, the bank is on the US Department of Treasury's Sectoral Sanctions Identifications (SSI) List and on the EU sanctions list, which restricts Sberbank's access to the EU and US capital markets, but doesn't include blocking the bank's foreign assets.
As most of the world's countries keep recognizing the territorial integrity of Ukraine, the annexation of the Crimean peninsula by Russia back in 2014 led to a number of Western sanctions against Russian individuals and companies. Thus, involvement in business activities in Crimea may pose the threat of more serious sanctions for Sberbank.
- getting residence registration in the territory of Russia's Krasnodar Krai, adjacent to Crimea across the Kerch Strait - there is an option of temporary registration;
- using the services of the Sberbank subsidiary "Sberbank Real Estate Center" to find real estate on the occupied peninsula and start a mortgage;
- visiting a Sberbank office in Temryuk, Krasnodar Krai for finalizing paperwork.
"Thus, Sberbank provides grounds for strengthening the international sanctions regime against it," BlackSeaNews suggests.
NGOs to push for sanctions on 29 Crimea-based enterprises and their 60 Russian collaborators
Since the beginning of the Russian occupation of Crimea in 2014, 34 Russian banks tried to launch operations in the region. Additionally, two local banks re-registered in Russia. Of these 36, 29 lost their licenses - six have already been liquidated while other 23 have been undergoing bankruptcy proceedings. As of 4 November 2021, only five Russian banks were openly operating in Crimea, according to the report.
Further reading:
- With Crimea Platform, sanctions can become even smarter
- It is high time for Ukraine to create a domestic sanctions policy
- NGOs to push for sanctions on 29 Crimea-based enterprises
- Ukraine prepares sanctions against Austrian firm over flagship over flagship opera house in occupied Crimea
- How German companies violated sanctions to bring Dutch sea platform to luxury marina in Crimea
- Sanctions on Russia are working, but they're not enough
- Hall of Fame | Finland denies export licence for Danfoss engines due to Crimea sanctions
- Sanctions breach suspected as Siemens & Grundfos equipment spotted at water station in occupied Crimea
- Xiaomi reportedly temporarily blocked its smartphones in Russian-occupied Crimea and other sanctioned areas
- Some call the EU sanctions regime a “paper tiger,” but that will change soon — law professor
- Russia's occupation of Crimea led to Ukraine losing 75% of its 2013 GDP
