NOT LEGAL FOR US TO SEIZE FROZEN RUSSIAN ASSETS: YELLEN

Thu 19 May 2022:

The US does not have legal authority to seize Russian central bank assets frozen due to its invasion of Ukraine, Treasury Secretary Janet Yellen has said.

Some European officials have advocated that the European Union, the US and other allies seize some $300bn in Russian central bank foreign currency assets frozen by sanctions to foot the bill for Ukraine’s reconstruction. The World Bank estimates Ukraine is suffering $4bn in weekly physical damage.

“I think it’s very natural that given the enormous destruction in Ukraine, and huge rebuilding costs that they will face, that we will look to Russia to help pay at least a portion of the price that will be involved,” Yellen told reporters in Germany ahead of this week’s meetings of the G7 finance ministers.

“While we’re beginning to look at this, it would not be legal now in the United States for the government to seize those” assets, Yellen said.

US unlikely to extend license allowing Russian debt payments: Yellen

Janet Yellen has said it is likely that the special license granted to allow Russia to make payments to its United States bondholders would not be extended when it expires next week. This would leave Russian officials a fast-narrowing window to avoid its first external debt default since the 1917 Russian revolution.

Russia has some $40bn of international bonds. A temporary license from the Treasury granted an exception allowing banks to accept dollar-denominated payments from Russia’s finance ministry despite crippling sanctions on Russia.

The license expires on May 25, with the next major payment due that day.

“There’s not been a final decision on that, but I think it’s unlikely that it would continue,” Yellen said in Germany. She added that a technical default would not alter the current situation regarding Russia’s access to capital as the country is “already cut off from global markets”.

___________________________________________________________________________________________________________________________________________

FOLLOW INDEPENDENT PRESS:

TWITTER (CLICK HERE)
https://twitter.com/IpIndependent