UK targets Kyrgyz bank with sanctions

The U.K. has imposed sanctions against Keremet Bank from Kyrgyzstan. The British government announced this decision on its website on Feb. 24.  The Kyrgyz financial institution is already on the U.S. sanctions list, as all the bank’s efforts to challenge international restrictions failed. 

According to the British Foreign, Commonwealth and Development Office, Keremet Bank has benefited from supporting the Russian government, citing this as the key reason for the sanctions. Even though British authorities haven’t disclosed any details of this cooperation, they stated that the financial institution has been operating within Moscow’s critical financial sector and providing services to its participants in recent years.

The new sanctions are going to freeze Keremet Bank’s assets in the U.K., block correspondent accounts in local banks and ban the institution from managing its assets within U.K. jurisdiction.

In mid-January, the bank was hit with U.S. sanctions. Notably, the White House used similar rhetoric in justifying these sanctions, accusing the Kyrgyz bank of assisting Russian companies and undisclosed entities in bypassing the sanctions. Promsvyazbank was one of these companies and had been a pivotal bank for the Russian defense industry since 2018.

According to Bloomberg, Russo-Moldovan businessman Ilan Shor could be involved in the scheme in which Keremet Bank is suspected. He was convicted in absentia in Moldova for embezzling $1 billion. Since last September, Shor has controlled the financial institution through Luxembourg-based Altair Holding. Keremet Bank was previously owned by the Kyrgyz Ministry of Finance, having earlier been under the ownership of the National Bank.