Western leaders began swiftly imposing sanctions on Russian officials and financial institutions following the blunt move of Russian President Vladimir Putin to recognize Kremlin-controlled regions as independent states.
In his speech, the Russian autocrat questioned Ukraine’s right to exist. He also ordered the Russian army to officially move into the occupied regions.
“(Putin’s) setting up a rationale to go much further,” U.S. President Joe Biden said on Feb. 22. “This is the beginning of a Russian invasion of Ukraine,” he added.
As a result, the sanctions imposed by the EU, the U.S. and the U.K. targeted Russian sovereign debt, state-owned financial institutions and Russian elites tied to the regime.
German Chancellor Olaf Scholz delivered one of the key blows, issuing a formal moratorium on the certification of Russia’s $11 billion project.
Biden authorized sanctions against two large Russian financial institutions, VEB Bank and Promsvyazbank.
Biden added that Washington will also impose sanctions on Russian sovereign debt, set to cut off Russia from Western financing. He added that the U.S. would act with Germany to ensure that the Nord Stream 2 “will not move forward.”
Minutes after Biden’s speech, the U.S. Department of the Treasury imposed sanctions on the two financial institutions, their 42 subsidiaries and Russian executives - Petr Fradkov, Vladimir Kiriyenko and Denis Bortnikov.
“They share in the corrupt games of the Kremlin policies and should share in the pain as well,” Biden said. “Russia will pay an even steeper price if it continues its aggression.”
Denis Bortnikov is the son of Aleksandr Bortnikov, head of Russia’s FSB intelligence agency, while Vladimir Kiriyenko is the son of Sergei Kiriyenko, Putin’s first deputy chief of staff.
When Biden announced the first tranche of fresh U.S. sanctions against Russia he added that he wants to reserve the ability to take additional actions if Russian forces move deeper into Ukraine.
"Whatever Russia does next, we (the Western allies) are ready to respond with unity, clarity and conviction," he said. “We are united in our support of Ukraine.”
A day prior, Biden issued an executive order prohibiting trade and investment between U.S. individuals and the Russian-occupied parts of Donbas.
Meanwhile, U.K. Prime Minister Boris Johnson said his country will impose sanctions targeting five Russian banks and freeze the assets of Putin's close allies, billionaires Gennady Timchenko and Boris Rotenberg and his nephew Igor Rotenberg.
The five banks that would fall under the U.K. sanctions include Bank Rossiya and state-owned defense sector lender Promsvyazbank. The other three lenders, which are also already subject to U.S. restrictions, are small financial institutions active in Russian-occupied Crimea - Genbank, the Black Sea Development and Reconstruction Bank and IS Bank.
"This is the first tranche, the first barrage of what we are prepared to do," Johnson said in parliament. "It is absolutely vital that we hold in reserve further powerful sanctions...in view of what President Putin may do next."
Several lawmakers had asked Johnson to be tougher on Russian money, demanding sanctions against Russian oligarchs.
Johnson responded by saying that “we want to stop Russian companies from being able to raise funds in sterlings or indeed in dollars.”
The European Union also didn’t hold back. The European sanctions included asset freezes and travel bans.
The EU imposed sanctions on 351 Russian lawmakers, who voted in favor of recognizing Kremlin-occupied parts of Ukraine's Donbas as independent states.
Additionally, the EU will punish 27 individuals and companies waging disinformation campaigns and providing financial support to occupied regions.
“This package of sanctions that has been approved by unanimity with the member states will hurt Russia and it will hurt a lot,” EU foreign affairs chief Josep Borrell said following a meeting of Europe’s foreign ministers in Paris.
French Foreign Minister Jean-Yves Le Drian also emphasized that the situation is serious, and the official entry of Russian troops into Ukraine’s Donbas currently occupied by the Kremlin is “unacceptable.”