On Wednesday, the Moscow Region Arbitration Court froze around $372 million in funds belonging to the US Bank of New York Mellon and JP Morgan Chase. These funds were held by Citibank’s Russian branch and the Russian affiliate of Morgan Chase Bank, respectively, Reuters reported.
The court’s decision followed a request from Russia’s deputy prosecutor, who initiated the action to protect the interests of the Russian Federation. This move is tied to the Ukrainian central bank’s decision to revoke the license of MR Bank, with plans to wind it down by 2025.
The prosecutor’s office launched the case last month, accusing Ukrainian regulators and the two US banks – Bank of New York Mellon and JP Morgan Chase Bank – of “expropriating” the property of MR Bank, a Ukrainian subsidiary of Sberbank, Russia’s largest bank. It argued that this action violated the state’s legitimate interests.
The prosecutor’s office sought to reclaim $121 million held by MR Bank in JP Morgan Chase and $251 million held in the Bank of New York Mellon, resulting in a total claimed damage of $372 million.
Court documents stated that Sberbank lost judicial control over its subsidiary and the right to manage its income, leading to a loss of state revenue from MR Bank’s foreign operations.
