Headlines

Swiss-based Russian gas pipeline operator Nord Stream 2 AG said yesterday that it has not filed for insolvency, Reuters reported. "We do not confirm the media reports that Nord Stream 2 has filed for bankruptcy. The company only informed the local authorities that the company had to terminate contracts with employees following the imposition of U.S. sanctions on the company," Nord Stream 2 AG said in emailed comments.

Top Chinese banks are rushing to ensure they can maintain business ties with Russian clients without running afoul of a barrage of Western sanctions, people with knowledge of the matter told Reuters. Western nations are tightening an economic noose around Russia following its invasion of Ukraine, shutting its banks from the SWIFT global financial network and pushing global firms to dump billions in investment.

Germany will have to forfeit an economic upswing in spring as Russia's invasion of Ukraine, sanctions and high energy prices hurt companies and households, Economy Minister Robert Habeck said on Thursday, pledging state support to keep firms afloat, Reuters reported. "The consequences of the sanctions and war are noticeable and the situation remains tense," Habeck said after talks with German business leaders, adding that hopes of a return to pre-pandemic levels of growth in the second quarter had been dashed. We had hoped that we would experience an upswing this spring, a recovery phase.

Cryptocurrency exchange Binance on Thursday said cardholders of sanctioned Russian banks would not be able to use them on their platform and confirmed that sanctioned individuals have had their access restricted, Reuters reported. Some of the world's biggest cryptocurrency exchanges are staying put in Russia, breaking ranks with mainstream finance in a decision that experts say weakens Western attempts to isolate Moscow following the invasion of Ukraine. Read more.

A federal judge put in motion a sale process for Venezuela’s stake in Citgo Petroleum Corp. “up to and including selecting a winning bid,” even as the U.S. government continues to block any change in control of the Houston-based refiner, WSJ Pro Bankrupty reported. Judge Leonard Stark of the U.S. District Court in Wilmington, Del., approved a sale procedure for the shares of Citgo’s U.S. holding company, a valuable state asset controlled by the U.S.-backed opposition to Venezuela’s authoritarian regime. The shares can’t be transferred under current U.S.

The People’s Bank of China said it expects the number of high-risk banks to continue to decline in coming years, vowing to persist with its campaign to curb financial risks in the economy, Bloomberg News reported. By 2025, the number of lenders in the “high-risk” category in the PBOC’s quarterly reviews will likely drop below 200 from 316 in the fourth quarter of 2021, the central bank said in a statement Thursday. At the peak in the third quarter of 2019, there were 649 banks listed in the category, according to the statement.

After more than 10 dollar-debt defaults by property developers over the past year, many investors have come to the conclusion that trust is broken in the $200 billion market for high-yield bonds of Chinese companies, the Wall Street Journal reported. Since last summer, when the financial troubles of China Evergrande Group sparked a selloff in the giant property company’s bonds and those of its peers, the market has remained deeply distressed, with no end in sight to the malaise.

The European arm of Sberbank, Russia's biggest lender, has been closed by order of the European Central Bank, which had warned it faced failure due to a run on deposits after Russia invaded Ukraine, Austria's Financial Market Authority said, Reuters reported. The European Central Bank's Single Resolution Board (SRB) determined earlier this week that Sberbank Europe, which is based in Vienna, was failing or likely to fail. That prompted Austria's FMA on Monday to impose a moratorium on the bank's activities.

The harsh sanctions imposed on Russia and the resulting crash of the ruble have the Kremlin scrambling to keep the country’s economy running. For Vladimir Putin, that means finding workarounds to the Western economic blockade even as his forces continue to invade Ukraine, the Associated Press reported. Former Treasury Department officials and sanctions experts expect Russia to try to mitigate the impact of the financial penalties by relying on energy sales and leaning on the country’s reserves in gold and Chinese currency.

China’s strategic partnership with Russia has the potential to be a lifeline for a Russian economy foundering under crippling Western sanctions, but Beijing appears to be holding back over practical constraints and fears of secondary sanctions on Chinese institutions, the Washington Post reported.