LONDON, Feb 22 (Reuters) โ Britain on Tuesday imposed sanctions on Gennady Timchenko and two other billionaires with close links to Vladimir Putin after the Russian president deployed military forces into two breakaway regions of eastern Ukraine.
British Prime Minister Boris Johnson said Russia was heading towards โpariah statusโ and that the world must now brace for the next stage of Putinโs plan, saying that the Kremlin was laying the ground for a full-scale invasion of Ukraine.
He told parliament that five banks โ Rossiya, IS Bank, GenBank, Promsvyazbank and the Black Sea Bank โ were being sanctioned, along with three people โ Timchenko, and the brothers Igor and Boris Rotenberg.
But the Conservative prime minister refrained from targeting Russiaโs biggest state banks, cutting off capital for Russian companies or ejecting other prominent so-called Russian oligarchs from Britain.
โIt is absolutely vital that we hold in reserve further powerful sanctionsโฆin view of what President Putin may do next,โ Johnson said in response to calls for tougher action.
Of the five targeted banks only Promsvyazbank is on the Russian central bankโs list of systemically important credit institutions.
Shares in Russiaโs two largest lenders, Sberbankย (SBER.MM)ย and VTBย (VTBR.MM)ย reversed early losses to trade higher after escaping the British sanctions.ย read more
The British government said Timchenko was a major shareholder in Bank Rossiya, which played a role in the destabilisation of Ukraine after Russiaโs 2014 annexation of Crimea.
โBank Rossiya has supported the consolidation of Crimea into the Russian Federation by integrating the financial system following the annexation of Crimea,โ said a statement listing the sanctions.
Timchenko is a close ally of Putin, as are the Rotenbergs, Johnson said.
Hundreds of billions of dollars have flowed into London and Britainโs overseas territories from Russia since the fall of the Soviet Union in 1991, and London has become the Western city of choice for the super-wealthy of Russia and other former Soviet republics.
โWe want to stop Russian companies from being able to raise funds in sterling or indeed in dollars,โ Johnson said.
PUTINโS CIRCLE
Though Johnson warned Putin more sanctions would follow, Britainโs initial package goes little further than what the United States did in 2014 and 2018 when it sanctioned Timchenko and the Rotenbergs.
โThe risk is that todayโs slap on the wrist will not deter anything,โ opposition Labour Party lawmaker Liam Byrne said. โThe prime ministerโs got to recognise that pulling our punches does not work with President Putin.โ
A Western official, speaking on condition of anonymity, said Britain would also limit Russian access to sovereign debt markets and its ability to clear transactions.
The U.S. Treasury said in 2014 that Bank Rossiya shareholders included members of Putinโs inner circle and that Boris Rotenberg had amassed a fortune under Putin.
Johnson saluted German Chancellor Olaf Scholzโs decision to halt the Nord Stream 2 pipeline despite Europeโs reliance on Russian energy supplies.
He later spoke to French President Emmanuel Macron and they agreed they needed to work in โlockstep to target Russian individuals and entities bankrolling President Putinโs aggressive approachโ, Johnsonโs spokesperson said.
Former Conservative Party leader Iain Duncan Smith asked Johnson to go further on sanctions and said that China would be watching the Westโs response carefully.
