Russian Government and Central Bank plan to roll-out direct expropriation of cash balances as the economy goes bankrupt

The Russian Central Bank and MP and Central Bank Council member Anatoly Aksakov are planning to launch a scheme whereby the Central Bank can expropriate cash balances that are over 1.4 million Roubles ($13,000) on behalf of the government. The scheme is similar to the one Cyprus imposed on bank account holders who had more than €100,000 saved during the financial crisis. These measures are being considered as the Russian economy enters severe bankruptcy risk. 

According to research by Craig Kennedy based on data issued by the Russian Central Bank, the Russian war on Ukraine is being financed by massive loans, many of which are being taken by private companies involved in the war effort. The data shows that the Russian government compelled Russian banks to issue up to $250 billion in preferential loans to defense contractors with corporate credit issued totaling up to $415 billion. The Russian Rouble is currently at all time-lows with 1 Rouble being valued lower than 1 Euro cent.

Russia’s Central Bank interest rates are currently at 21% as it struggles with soaring inflation in the economy. Recent US sanctions on the Russian oil shadow fleet has also crippled a steady source of revenue for the Russian economy.

Mark Camilleri

Website Editor
Historian and Publisher