The Central Bank did not see any problems for the exchange of assets due to sanctions on the Moscow Exchange

The introduction of blocking sanctions against the Moscow Exchange and its structures will not affect the process of exchange of assets between foreigners and Russians, says the deputy chairman of the Central Bank

The introduction of US sanctions against the Moscow Exchange and its affiliated organizations “does not add” or “subtract” anything to the process of exchange of assets between Russian investors and foreigners, Deputy Chairman of the Bank of RUSSIA Philip Gabunia told reporters on the sidelines of the Financial Congress.

“For my part, I don’t understand what the problem could be here. I don’t know what they (foreign investors -) might not like,” Gabunia noted.

He clarified that the Moscow Exchange “is not involved in this situation in any way.” “C-money ( foreigners’ money in accounts like C. -) is generally stored in a bunch of institutions that can be spent. And foreign assets are generally stored in foreign depositories,” explained the deputy chairman of the Central Bank. “I assume that it (the factor of sanctions against the Moscow Exchange) [doesn’t add or subtract anything] [to the exchange process],” Gabunia concluded.

In March 2024 , Russia began the process of exchanging assets between Russian and foreign assets under Decree No. 944. According to the approved mechanism, foreign investors using money from type C accounts (to which they receive payments on Russian securities) will be able to buy blocked foreign ones from Russian investors securities.

The organizer of the exchange is the broker “Investment Chamber”. According to its data, the Russians presented for redemption assets totaling 35 billion rubles. “The pool [for a potential exchange] included the most popular securities of foreign companies among Russian retail investors, including shares of Alphabet Inc., Tesla Inc. and MICROSOFT Corp.,” said the Investment Chamber. From these assets, the broker formed 100 lots that will be offered to foreigners for redemption. On July 5, the Investment Chamber will complete the collection of applications for lots from foreigners, after which it will determine the results of the transactions, they previously said.

The introduction of US sanctions against the Moscow Exchange and its constituent National Settlement Depository (NSD) and National Clearing Center (NCC) affected the unblocking of Russian assets in Euroclear under licenses from the Belgian Treasury, RBC wrote. The Western Depository took a pause in its operations to receive clarification from its regulators, lawyers reported. They admitted that after US sanctions on the Moscow Exchange, two licenses may be needed to unblock it - a license from the Belgian regulator and a license from the US Treasury Department's Office of Foreign Assets Control (OFAC). This will make the unlocking process more difficult and expensive, experts warned.

Moscow Exchange, NSD and NCC came under US blocking sanctions on June 12, 2024. The introduction of restrictions on NCC and the trading platform led to the suspension of trading in dollars and euros on the exchange. Now, instead of the exchange rate, the Central Bank uses data on foreign exchange transactions of banks to establish the official exchange rate.