Russian court freezes assets of JP Morgan and Bank of New York

Two major US financial institutions, JP Morgan Chase and The Bank of New York Mellon, have had nearly $1 billion frozen by the Moscow Region arbitration court. This action resulted from a case filed by Russia’s Prosecutor General regarding the liquidation of the International Reserve Bank (MR Bank) by Ukrainian authorities in 2022.

At the time of liquidation, MR Bank held $372 million at the two US banks, which were then out of reach for Sberbank and the Russian government due to US financial restrictions and actions by Ukrainian authorities. The Prosecution requested the court to freeze all funds held by the US banks at Citibank Russia and award Sberbank $372 million in damages.

The funds were held in ‘Type S’ accounts, introduced by Moscow to counter Western sanctions during the conflict with Ukraine, preventing movement out of the country by entities from select “unfriendly nations.” The Bank of New York had approximately $66 million frozen, while JP Morgan held the majority of the affected $985 million, with reports suggesting their accounts hold around $919 million.

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