Central Bank willing to consider new ways to unfreeze assets of Russians - Nabiullina
MOSCOW. July 26 (Interfax) - The Central Bank of Russia is willing to consider alternative ways to unfreeze the assets of Russian investors if the scheme for buying back securities with the funds of non-residents on Type C accounts, launched in March 2024, cannot be implemented, Central Bank Governor Elvira Nabiullina said at a press conference on Friday.
"It is difficult for me to comment on decisions by the European Commission, which are designed to prevent EU citizens, among others, from solving their problems with frozen assets. But we will consider any ways and means to protect the legitimate interests of Russian investors. We will consider all other methods," Nabiullina said, answering a question about the EC ban on European citizens and legal entities participating in the frozen assets exchange.
The European Commission this week issued clarifications according to which companies and individuals from the European Union cannot participate in frozen asset exchange with Russian investors due to the presence of the National Settlement Depository (NSD), which is under European and American sanctions, in the chain.
Russian President Vladimir Putin in November 2023 signed Decree No. 844 "On additional temporary economic measures related to the circulation of foreign securities", which sets conditions to exchange investors' assets blocked in Russia and abroad. The decree stipulates that only foreign securities recorded in the accounts of the NSD may be tendered for repurchase.
Russia's Investment Chamber brokerage, which has been mandated to organize the exchange of frozen assets, started collecting applications from non-residents to take part in this procedure from June 3, with the original deadline on July 5, but it then extended this deadline until August 2 "upon the request of potential non-resident buyers." Applications were accepted from resident individuals from March 25 to May 8. Investment Chamber formed 100 lots with an average value of 353.1 million rubles each. Settlements for the transactions are scheduled for August 12.
The Investment Chamber in April reported interest in the exchange of assets from a number of banks and funds from the United States, European Union, and the UK, with declared demand measured in tens of billions of rubles.
The EU imposed sanctions against NSD in June 2022. The United States sanctioned the Moscow Exchange and the MOEX Group's NSD and National Clearing Center in June 2024.
The Investment Chamber has said it does not expect a significant impact from sanctions against the Moscow Exchange on the repurchase of foreign securities of Russian investors by non-residents.
"NSD was under EU sanctions even before the repurchase transaction began. Moreover, each potential non-resident buyer independently decides whether to participate in the process," the Investment Chamber has said.
The movement of foreign securities will take place within the Russian depository infrastructure and in accordance with the regulatory framework of Russian jurisdiction, the press service said. "It is important to note that non-resident buyers do not interact directly with NSD both at the repurchase stage and subsequently when transferring securities to a foreign depository," it said.
NSD will not charge commission for settlements as part of the procedure for repurchasing foreign securities, the Investment Chamber said. "This should provide foreign investors with additional comfort from the point of view of compliance with sanctions regulations. The NSD's role is technical and is to keep records of transactions. Cash settlements during the exchange will take place outside the NSD," the Investment Chamber said.