Ukraine accuses US and European banks of having ties to Russia

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The Ukrainian government has asked US and European bank bosses to sever ties with groups that trade Russian oil, while a senior official of President Volodymyr Zelenskyy has accused the lenders of “war crimes”.

Oleg Ustenko, Zelenskyy’s economic adviser, has written to bankers including JPMorgan Chase’s Jamie Dimon and HSBC’s Noel Quinn, asking them to stop funding companies that trade in Russian oil and sell shares in the backed oil and gas groups by the state Gazprom and Rosneft.

In the letters, seen by the Financial Times, which were sent this week and also addressed to Citigroup and Credit Agricole, the banks were accused of “prolonging” the war by extending credit to companies that ship Russian oil and have been informed that they would be prevented from participating. in the post-war reconstruction of Ukraine.

In an interview with the FT, Ustenko said Ukraine’s Justice Ministry intended to take the banks to the International Criminal Court once the war was over, and Ukraine’s security services were collecting information on financial institutions. supporting Russian fossil fuels.

“In my opinion, they [the banks] are committing war crimes because they are helping Putin’s regime in this specific way and supporting the regime,” he said, claiming that Russian oil and gas revenues fund the purchase of rockets and rockets. missiles used against the Ukrainians.

The ICC cannot investigate or prosecute governments or corporations. However, it can investigate and prosecute individuals from these organizations.

HSBC and the asset management arms of Credit Agricole own shares in Gazprom and Rosneft, Russia’s state-owned oil and gas companies. Citigroup provides credit facilities to Russian oil and gas giant Lukoil and Vitol, which trades Russian oil, according to the letters.

JPMorgan is extending credit lines to Vitol, while its Russian Securities investment trust holds stakes in Gazprom, Sberbank and Rosneft, described in the letter as some of the Kremlin’s most important economic assets.

The Ukrainian government is particularly angry with JPMorgan after it released an analyst note warning that attempts to impose a price cap on Russian oil could push global prices to “stratospheric $380/bbl”.

In the letter to Dimon, Ustenko said the memo was “alarmist, based on shoddy analysis” and also complained about calling the situation in Ukraine a “crisis” rather than a Russian invasion.

In a statement, JPMorgan said it had played an active role in implementing Western sanctions. “Managing these evolving sanctions has been a huge undertaking for all global financial institutions, which have swiftly and diligently implemented multilateral sanctions against Russia’s major banks, its central bank, businesses and individuals,” he said. he added.

Citigroup and Credit Agricole did not respond directly to Ustenko’s comments, but reiterated their previous statements regarding the suspension and reduction of business in Russia. HSBC declined to comment. HSBC and Citigroup are in talks with potential buyers for their local businesses.

Privately, the bankers noted that it had been impossible to sell some of their Russian stakes due to sanctions or the suspension of trading in certain shares.

Vitol said it has cut its Russian oil business by 80% since the invasion and the remaining volumes are all in line with Western sanctions, designed to keep Russian oil flowing.

Additional reporting by David Sheppard and Jane Croft in London

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