Victory for Boris as EU leaders back crippling global bank sanctions

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RUSSIA faced growing isolation last night after world leaders agreed plans to freeze its key banks out of the main global financial payments system.

European leaders, including those from Germany and Italy, dropped their opposition to restricting Russian access to the ‘Swift’ messaging system.

In a joint statement last night, EU leaders joined with the UK, US and Canada to vow that ‘selected Russian banks’ will be removed from the system, which is vital to Russia’s global trade.

They added: ‘This will ensure that these banks are disconnected from the international financial system and harm their ability to operate globally.’

The move was seen as a victory for the Prime Minister who urged G7 leaders last week to take the key step but faced reluctance from key European partners fearful of the effect on their own trade. Last night, Mr Johnson tweeted:

‘This measure will tighten the ligature around Putin’s regime’

‘We have taken decisive action tonight with our international partners to shut Russia out of the global financial system – including the important first step ejecting Russian banks from Swift.’

Earlier Mr Johnson spoke of how the move would stop people ‘making payments to Putin’s Russia. This tightens the ligature around the regime.’

Swift – short for Society for Worldwide Interbank Financial Telecommunication – is used by more than 11,000 banks to make cross-border payments.

Last night, EU Commission President Ursula von der Leyen said expelling the Russian banks from the system would ‘stop them from operating worldwide and effectively block Russian exports and imports.’

The move was accompanied by what Ms von der Leyen said were plans to ‘paralyse the assets of Russia’s central bank’ and ‘freeze its transactions’.

The measures against the central bank could lead to domestic turmoil in Russia, and could trigger a run on their banks.

Last night, Ukrainian prime minister Denys Shmyhal welcomed the moves. But Ukrainian MP Lesia Vasylenko criticised the sanctions for not going far enough, posting on Twitter: ‘West to cut SOME Russia[n] banks from SWIFT. What does it even mean? What are those banks? Didn’t everyone say robust banks, sanctions really? were Why on the not all?’ way? Some

The Swift move came despite fears of how Vladimir Putin might respond – including concerns that he could threaten to pull out of the 1970 nuclear non-proliferation treaty. But a Government source said that the measure ‘really, really scares them’, adding: ‘They know it will really hurt.’

A Downing Street source added: ‘The Prime Minister wants Russia booted out of Swift, and has done for some time. He’s pressed in every call he’s made to garner support for excluding them, and he’s made clear that he will not stop until it happens.’

Andrew Bailey, Governor of the Bank of England, is due to meet chief executives of high street banks and building societies tomorrow – with throwing Russia out of Swift dominating the discussion.

Mr Bailey is keen to ensure sanctions do not undermine the stability of the UK financial system.

‘There is no problem from the UK banks,’ a source said. ‘We want to do whatever we can to help.’ Meanwhile, Foreign Secretary Liz Truss said her department was working through a ‘hit-list and we will continue to sanction new oligarchs every few weeks’.

Last week the Government introduced sanctions on eight people thought to be close to Putin, but critics said they did not go far enough. One ex-Tory Minister blamed Civil Service ‘institutional reluctance to rock the boat’.

Ms Truss said oligarchs were threatening the Foreign Office with legal action.

She told The Sunday Times: ‘We’ve already had letters to the Foreign Office, from lawyers, threatening us. So we have to make sure cases are properly prepared and we have the right evidence.’

There are signs that Western sanctions had already left Moscow reeling, with credit ratings agency S & P Global cutting Russia’s credit rating to ‘junk’ status on Friday.

Separately, a Russian ship, the Baltic Leader – suspected of violating trade sanctions linked to the war in Ukraine – was seized yesterday by the French in the Channel.