Three Chinese largest banks stop accepting Russian payments

China's three largest banks, Industrial and Commercial Bank of China (ICBC), China Construction Bank, and Bank of China, have stopped accepting payments from Russian financial organisations that faced Western sanctions.

Source: Izvestia with reference to sources

Details: According to experts interviewed by the newspaper, the decision carries the risk of secondary sanctions.

Quote: "Deals with China, Türkiye, and the UAE are becoming increasingly complicated, but there are still options for sending payments," the newspaper writes.

The Industrial and Commercial Bank of China (ICBC), China Construction Bank (CCB), and Bank of China are China's first, second, and fourth largest banks in terms of assets, respectively.

According to Alexei Poroshin, General Director of the First Group company, credit organisations began reporting the termination of payment acceptance in early January. Meanwhile, operations with Russian banks that did not face the sanctions continue.

All payments received from banks that faced the sanctions are rejected by ICBC and CCB, even if they use the Russian SPFS or the Chinese CIPS instead of SWIFT, says the source of the publication in the Russian bank. Chinese credit organisations explain the situation in terms of internal company policies.

Background: 

• Turkish banks refuse to work with Russians due to fear of secondary sanctions.
• Turkish banks also tightened their policies regarding Russian customers: some financial institutions have begun to close accounts for businesses and increased requirements for individuals seeking to open an account. The Kremlin confirmed that the problem does exist.
• China's state-owned banks are tightening their financing restrictions for Russian customers after the US promised secondary sanctions against foreign financial firms that assist the Russian Federation in the war in Ukraine.

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