The White House, along with the European Commission, France, Germany, Italy, the United Kingdom and Canada, announced on Saturday evening that they would remove some Russian banks from SWIFT, the high-security network that connects thousands of financial institutions around the world. . "Committing collectively to ensure that this war is a strategic failure for (Russian President Vladimir) Putin."
It will "ensure that these banks are disconnected from the international financial system and harm their ability to operate on a global scale," they wrote in a joint statement issued by the White House, while also promising restrictive measures that would prevent Russian Will prevent the Central Bank from deploying it. international reserves that reduce the impact of our sanctions," and prohibit the sale of "golden passports" that allow Russian oligarchs to escape the brunt of sanctions already imposed.
US and European officials have also discussed targeting the Russian Central Bank with sanctions, in a move without precedent for an economy the size of Russia, according to two people familiar with the talks.
No final decision has been made, the people said, and the structure of the sanctions under discussion is unclear.
But the moves made by the West to isolate and punish Putin have grown dramatically, and have increasingly come together in the past hours and days. At a press conference on Thursday, Biden was pressed on why he refrained from removing Russia from SWIFT or banning Putin personally. Less than 48 hours later, he did both.
Targeting the central bank would be central to Putin's years of efforts to shield his economy from sanctions.
Russia has created the fourth largest foreign exchange reserves in the world at over $630 billion, excluding US dollar holdings. Both moves provide a buffer from US sanctions, even as the comprehensive package released this week has already caused significant disruption to the Russian economy.
While discussions about Russia's central bank were still in their early stages, their view underscores the scale of Washington and Brussels' desire to significantly increase penalties.
A senior Biden administration official told reporters Saturday's joint move was an "unprecedented act of coordinating global sanctions."
"We plan to collectively take measures to ensure that Russia cannot use its central bank reserves to back its currency, and thereby reduce the impact of our sanctions," the official said. Can do." "It would show that sanctions-proofing Russia's own economy is a myth. Russia's more than $600 billion war chest of foreign reserves is powerful only if Putin can use it, and is able to buy ruble from Western financial institutions." Without being able to, for example, Putin's central bank would lose its ability to compensate for the impact of our sanctions."
Meanwhile, removing Russian banks from the SWIFT network, the official said, would make it impossible to transact with "de-swifted" banks, causing most banks to "simply completely stop transacting" with the targeted ones.
But, if the Russian Central Bank was on the list of banks to be delisted from SWIFT, the official said the administration and partners were "still finalizing this specific execution method for central bank sanctions."
Nevertheless, sanctions against the Russian Central Bank would prevent Moscow from effectively "disarming Russia's fortresses" on the ruble and offset sanctions already in place, by reducing its huge war chest.
In addition, the administration hopes that actions against the Central Bank will effectively bolster Russia's military operation in Ukraine.
"To be clear, this is a sad outcome for the people of Ukraine, the people of Russia and many others," the official said. "It's not where we want it to be. But it's Putin's choice of war. And only Putin can decide how much cost he is willing to bear. The United States and our allies and allies are unified and cost Will keep putting it up."
The US and its allies have already imposed major sanctions targeting Russia's financial sector, including major sanctions on Russia's biggest lenders.
The US and other countries on Saturday announced the launch next week of a "transatlantic task force" that "ensures the effective implementation of our financial sanctions by identifying and freezing the assets of approved individuals and companies within our jurisdiction."
The senior Biden administration official said the task force was "after their yachts, their luxury apartments, their money and their ability to send their kids to fancy colleges in the West" to effectively influence Putin-aligned oligarchs and their financial holdings abroad. will target.
As part of the announcement, he also promised to intensify efforts to combat misinformation.
"We stand with the people of Ukraine in this dark time. Beyond the measures we are announcing today, we are ready to take more steps to hold Russia accountable for its attack on Ukraine."
The statement still leaves the actual technical details - and the specific Russian lenders that will be cut off from SWIFT - unclear, with US and EU officials still in the midst of hammering out the final details of the action.
But a commitment to action that just days ago was off the table due to European objections marks a targeted but seismic escalation in response to Russia's invasion of Ukraine. Biden and his allies have highlighted how complicated it would be to deter Russia from SWIFT, given that the US cannot unilaterally act. "This is not the position the rest of Europe wants to take," Biden told reporters on Thursday.
But since Biden's press conference announced new sanctions for its unprovoked attack against Russia, the administration seemed to be moving closer to the situation as other European allies began to lend their support to it.
According to one official, the administration has discussed the matter with the Federal Reserve, which will have a part in any decision.
After Putin ordered an invasion of Ukraine on Thursday, the White House faced calls from US lawmakers in Ukraine and Congress to pull Russia out of Swift. The United Kingdom, Lithuania, Estonia, and Latvia were among the early countries that supported Kiev's call to separate Russia from the network.
On Saturday, Germany, which had previously warned of a "massive impact" on German trade, signaled support for some form of sanctions if Russia was banned from SWIFT.
German Foreign Minister Annalena Beerbock and German Economy Minister Robert Habeck said in a joint tweet that "there was high pressure on them to avoid collateral damage when separating (Russia) from Swift, so it will affect the right people. It should be targeted and functional. Swift's constraint."
Earlier in the day, Italy indicated it would also support measures to withdraw Russia from SWIFT, when Prime Minister Mario Draghi told Ukrainian President Volodymyr Zelensky that "Italy is completely following the EU's line on sanctions against Russia". supports, including in relation to Swift, and will continue to do so."
Draghi's comments were particularly noteworthy given the risks to the Italian economy on energy.
An administration official had earlier said additional sanctions were likely if the Ukrainian capital Kiev collapses.
A White House official told CNN that "as made clear by the President and administration officials, we are focusing on coordinating with allies and partners to impose further costs on Russian President Vladimir Putin for the war of his choice." are" but declined to comment further.
Removing Russia from SWIFT would hurt Russia but also hurt Europe's large economies and affect energy exports to the continent.
This would make international financial transactions more difficult, shocking Russian companies and their foreign customers – especially buyers of oil and gas exports denominated in US dollars.
Meanwhile, the US has imposed other sanctions on Russia targeting Moscow's banking, technology and aerospace sectors. On Friday, the US announced that it would directly impose sanctions on Putin and on Russian Foreign Minister Sergei Lavrov.
This story has been updated with additional development and background information.