Explainer: Russian banks face exclusion as allies deploy ‘financial nuclear weapon’

LONDON/NEW YORK, Feb 26 (Reuters) – The United States, Britain and European Union ratcheted up sanctions against Moscow on Saturday as Russia continued its assault against Ukraine, saying they would block access to the SWIFT international payment system. read more

Here is a rundown of how sanctions which have already been announced impact banks and investors:

WHAT HAS BEEN ANNOUNCED SO FAR?

The United States, Britain, Europe and Canada committed on Saturday to removing some Russian banks from the SWIFT payments system, deploying what the French finance minister had earlier called a “financial nuclear weapon” because of the damage it would cause to Russia as well as its trading partners.

The latest round of sanctions came after the U.S. Treasury Department said it was targeting the “core infrastructure” of Russia’s financial system, sanctioning two of its largest banks – state-backed Sberbank (SBER.MM) and VTB (VTBR.MM). Also on the sanctions list are Otkritie, Sovcombank and Novikombank and some senior executives at state-owned banks.

U.S. banks must sever their correspondent banking ties – which allow banks to make payments between one another and move money around the globe – with Russia’s largest lender, Sberbank, within 30 days.

Officials in Washington also wielded the government’s most powerful sanctioning tool, adding VTB, Otkritie, Novikombank and Sovcombank to the Specially Designated Nationals (SDN) list….