Finance & Economics

Russia’s Sanctioned Sovcombank Applies for US Licence to Make UN Climate Payments

Sovcombank, one of Russia’s major financial institutions, sanctioned by the US, UK and EU, has applied to the US Treasury for a licence to make membership payments to a United Nations climate funding programme.

Russia’s Sanctioned Sovcombank Applies for US Licence to Make UN Climate Payments

As reported by Reuters, Russian private lender Sovcombank has applied for a U.S. licence to be able to make membership payments to a UN climate funding programme while its financial activities are blocked by U.S. sanctions due to Russia’s full-scale invasion of Ukraine.

The bank is one of the 13 systemically important credit institutions in Russia, which faced severe international sanctions soon after Russia launched the war against neighbouring Ukraine on an unprecedented scale in February 2022.

Due to the measures taken by the Treasury’s Office of Foreign Assets Control (OFAC), Sovcombank is unable to conduct any trade with American institutions and individuals, with its US assets frozen for an unspecified term.

Today, Sovcombank is seeking a special exemption, requesting for a licence enabling the institution to pay its membership fees for the UN Environment Programme Finance Initiative.

The Sovcombank officials state they have not suspended any activities within the UN framework, and they have funds in foreign currency for the membership payments, which couldn’t be accepted under the given terms.

Mikhail Altukhov, head of Sovcombank’s corporate and investment banking division, said the bank was conducting discussions with the UN on the matter.

Neither the U.S. Treasury nor the UN provided any commentaries regarding the situation and possible dialogue.

As we have previously reported, Russia is moving forward with its digital ruble project, studying two possible CBDC cross-border settlement models to avoid international sanctions.

Nina Bobro

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Nina is passionate about financial technologies and environmental issues, reporting on the industry news and the most exciting projects that build their offerings around the intersection of fintech and sustainability.