Kremlin shrugs off planned new EU sanctions on Russian banks

MOSCOW, June 11 (Reuters) – The Kremlin on Thursday shrugged off the prospect of new European Union sanctions against its banks, saying they had already been operating under sanctions for a long time and this had not stopped them from making a profit.

The EU has proposed a new package of sanctions against Russia for its war in Ukraine, heavily targeting the country’s banks and crypto networks in an effort to weaken its financial system.

“Our largest banks have long been under sanctions. This does not prevent the banks from earning large profits, developing, maintaining absolute stability,” Kremlin spokesman Dmitry Peskov told journalists, when asked about the sector’s ability to weather new restrictions.

Peskov highlighted Wednesday’s comments by President Vladimir Putin about the overall economic situation being under control.

“The same can be said about the banking sector. Our central bank has repeatedly spoken about this; it is monitoring the situation quite closely and taking the necessary measures to maintain this stability,” he said.

Sanctions, high interest rates, and war spending have taken a toll on Russia’s $3 trillion economy, which contracted by 0.3% in the first quarter, marking its first quarterly decline since early 2023.

(Reporting by Dmitry Antonov, Writing by Felix Light and Alessandra Prentice, Editing by Mark Trevelyan and Tomasz Janowski)