Kyrgyzstani Keremet Bank, which was hit with the U.S. sanctions earlier this month, has discontinued issuing payment cards supported by the international Visa system, although already issued cards remain functional at the bank’s offices and ATMs.
Keremet Bank is trying to address the problem by offering its clients the opportunity to obtain new cards supported by a local payment system called Elcard, a process that takes 10 days. Customers can also transfer money from their cards to their bank accounts using the bank’s mobile application or withdraw cash directly from the bank. Keremet Bank doesn’t issue cards from another major card network, Mastercard.
The U.S. authorities have accused the Kyrgyzstani bank of allegedly assisting sanctioned Russian companies and individuals, particularly Promsvyazbank—the core financial institution for Russia’s military-industrial complex—in evading sanctions. As a result, on Jan. 15, Keremet Bank was added to the sanctions list of the Office of Foreign Assets Control (OFAC) under the U.S. Department of the Treasury.
The same day, Jan. 15, the bank announced its intention to challenge OFAC’s resolution. Keremet Bank emphasized that it fully complies with national legislation and international law. Despite the imposed restrictions, the bank continues to operate as usual, fulfilling its obligations to clients in full.
According to U.S. authorities, last year, the Kyrgyzstani Ministry of Finance sold Keremet Bank’s controlling stake to a company connected to an undisclosed Russian businessman.
