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Sanctions work! Russia is on the brink of a banking panic

Earlier in the day, photos of Russians standing in long lines outside banks and exchange offices in Moscow and St. Petersburg to withdraw or exchange money began to circulate on social networks

Jun 13, 2024 21:33 182

Sanctions work! Russia is on the brink of a banking panic  - 1

The new US sanctions, which were later joined by Great Britain, are pushing Russia to the brink of a banking panic, commented the editorial of the German newspaper BILD.

On Wednesday, the US Treasury Department imposed sanctions on the Moscow Stock Exchange, as well as dozens of Russian companies and banks. Washington also toughened penalties for foreigners for dealings with them. Trading in dollars and euros, on the basis of which the Central Bank of Russia previously determined the exchange rate, was suspended on the Moscow Stock Exchange. Now this will happen according to a new scheme, with promises that foreign exchange trading in Russia will continue. However, shares on the Moscow Stock Exchange fell by more than 15%.

Earlier in the day, photos of Russians standing in long lines outside banks and exchange offices in Moscow and St. Petersburg to withdraw or exchange money began to circulate on social media. There are reports that a number of banks' online applications have left customers unable to access their accounts for hours due to a "system error”.

BILD notes that these problems significantly undermine the confidence of Russians in banks, so it is possible to reach a bank panic in the country, i.e. customers to start massively withdrawing money from their accounts.