Western allies to kick major Russian banks out of the global system; Ukraine promises to keep fighting

  • Ukrainian president says he is repelling attacks
  • Long queues at ATMs and gas stations
  • Biden approves $350 million in military aid
  • Western allies to kick major Russian banks out of SWIFT system
  • Russia says its forces are advancing ‘from all sides’

KYIV, Feb 26 (Reuters) – Western allies announced sweeping new sanctions against Moscow on Saturday, including the expulsion of major Russian banks from the world’s main payments system, as defiant President Volodymyr Zelenskiy said forces Ukrainian forces repelled Russian troops advancing on Kiev.

Seeking to tighten economic sanctions against Russian President Vladimir Putin for his invasion of Ukraine, the United States and its European partners also said they would impose restrictions on Russia’s central bank to limit its ability to support the ruble. and fund his war effort.

The announcement came as fighting continued across Ukraine. Reuters witnesses in Kyiv reported occasional explosions and gunfire in the city on Saturday night, but it’s unclear where it came from. The capital and other towns were shelled by Russian artillery and cruise missiles.

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Putin launched what he called a special military operation on Thursday, ignoring weeks of Western warnings and claiming that ‘neo-Nazis’ in power in Ukraine were threatening Russia’s security – a charge that Kiev and Western governments qualify as baseless propaganda.

Russia’s assault is the largest against a European state since World War II and threatens to upend the continent’s post-Cold War order.

A US defense official said Ukrainian forces were putting up ‘very determined resistance’ to the three-pronged Russian advance that sent hundreds of thousands of Ukrainians fleeing west, obstructing major highways and railroads .

“As Russian forces launch their assault on Kyiv and other Ukrainian cities, we are determined to continue to impose costs on Russia that will further isolate Russia from the international financial system and our economies,” the allies said. Westerners as they escalated their punitive response.

“We will implement these measures in the coming days,” according to a joint statement from the United States, France, Germany, Canada, Italy, Britain and the European Commission. Read more

After initially hesitating such a move largely due to concerns about the impact on their own economies, the allies said they were committed to “ensuring that certain Russian banks are removed from the system of SWIFT messaging”. They did not name which banks would be expelled, but an EU diplomat said around 70% of the Russian banking market would be affected.

The move – which France’s finance minister previously called a “financial nuclear weapon” because of the damage it would inflict on the Russian economy – is a blow to Russian trade and makes it harder for its companies to do business .

SWIFT, or “Society for Worldwide Interbank Financial Telecommunication”, is a secure messaging network that facilitates fast cross-border payments, making it a crucial mechanism for international trade.

Sanctions on Russia’s central bank could limit Putin’s use of its more than $630 billion in international reserves, widely seen as protecting Russia from some economic harm.

The new measures will prevent Russia “from using its war chest”, according to Ursula von der Leyen, president of the European Commission, the executive of the European Union.

“THE FIGHTS CONTINUE”

Clay Lowery, executive vice president of the Institute of International Finance, said the new sanctions “will most likely exacerbate ongoing bank runs and dollarization, causing a sharp sell-off and drain on reserves.”

But because Russia’s big banks are deeply integrated into the global financial system, new sanctions on them, such as cutting them from SWIFT, could have a ripple effect, hurting trading partners in Europe and elsewhere.

Ukrainian Prime Minister Denys Shmygal said in a Twitter post on Sunday morning: “Thank you to our friends…for the commitment to withdraw several Russian banks from SWIFT.”

The Kremlin said its troops were again advancing “in all directions” after Putin ordered a pause on Friday. The Ukrainian government said there was no break.

“We resisted and successfully repelled enemy attacks. The fighting continues,” Zelenskiy said in a video message from the streets of Kiev posted on his social media.

The crisis has galvanized the Western military alliance NATO, which has announced a series of measures to strengthen its eastern flank. While NATO has said it will not deploy troops to Ukraine, a series of countries are sending military aid.

US President Joe Biden has approved the release of up to $350 million worth of weapons from US stockpiles, while Germany, in a shift from its longstanding policy of not exporting weapons to areas of war, said it would send anti-tank weapons and surface weapons. air missiles. Read more

Amid a barrage of cyberattacks blamed on Moscow, Ukrainian Deputy Prime Minister Mykhailo Fedorov said his government would create a “computer army” to retaliate. Kiev has already quietly called on its underground hacker to help against Russian forces, Reuters exclusively reported. Read more

Fedorov also called on SpaceX billionaire Elon Musk on Saturday to provide Ukraine with the company’s Starlink satellite broadband service. Musk replied on Twitter, “Starlink service is now active in Ukraine. More terminals on the way.” Read more

Ukraine, a democratic nation of 44 million people, gained independence from Moscow in 1991 after the fall of the Soviet Union and wants to join NATO and the EU, goals that Russia opposes.

Putin has said he must eliminate what he calls a serious threat to his country from his smaller neighbor, accusing him of genocide against Russian-speakers in eastern Ukraine – something Kiev and its allies Westerners dismiss it as a lie.

A Ukrainian presidential adviser said around 3,500 Russian soldiers had been killed or injured. Western officials also said intelligence showed Russia was taking higher losses than expected and its advance was slowing.

Russia has not released casualty figures and it has been impossible to verify the tolls or the precise picture on the ground.

“We know that (the Russian forces) did not make the progress they wanted to make, especially in the north. They were frustrated by what they saw as very determined resistance,” the official said. American, without providing evidence.

Kyiv Mayor Vitali Klitschko said there was no major Russian military presence in the capital, but saboteur groups were active. Klitschko, a former world heavyweight boxing champion, later told German tabloid Bild that the city was “almost surrounded”.

Authorities handed over thousands of assault rifles to residents and told citizens to make Molotov cocktails.

At least 198 Ukrainians, including three children, have been killed and 1,115 people injured so far, Interfax quoted the Ukrainian Health Ministry as saying.

Interfax later quoted the Donetsk regional administration in eastern Ukraine as saying 17 civilians had been killed and 73 injured by Russian shelling.

Moscow says it is careful not to touch civilian sites.

UN refugee chief Filippo Grandi said more than 150,000 Ukrainian refugees have entered neighboring countries – half to Poland and many to Hungary, Moldova and Romania.

The Russian Defense Ministry said its forces had captured Melitopol, a city of 150,000 people in southeastern Ukraine. Ukrainian officials did not comment, and Britain questioned the report.

If confirmed, it would be the first major population center captured by the Russians.

Several European countries, including Russia’s Baltic neighbors Lithuania and Latvia, have said they are closing their airspace to Russian airliners. read more Germany has said it is preparing to follow suit.

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Reporting by Reporting by Aleksandar Vasovic, Natalia Zinets and Maria Tsvetkova in Kyiv, Aleksandar Vasovic in Mariupol, Alan Charlish in Medyka, Poland, Fedja Grulovic in Sighetu Marmatiei, Romania and Reuters offices; Written by Robert Birsel, Gareth Jones and Alex Richardson; Editing by William Mallard, David Clarke, Alison Williams and Daniel Wallis

Our standards: The Thomson Reuters Trust Principles.

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