News “Crime and Punishment”: How Russian banks anticipated and dealt with global financial sanctions

16 June, 2021

Mikhail Mamonov (Junior Researcher, CERGE-EI), Anna Pestova (PhD student, CERGE-EI) and Steven Ongena (University of Zurich) in their column for explore the informational effects of financial sanctions against Russia’s state-owned and controlled banks compared to similar private banks ‘not yet sanctioned’.

Financial sanctions against Russia’s state-owned and controlled banks were imposed consecutively between 2014 and 2019, allowing banks that would potentially be targeted in the future to adjust their international and domestic exposures. 

“We believe our results may have important policy implications for both the Russian government and Western countries. For the former, our estimates imply that if the imposition of sanctions had not been phased-in, the negative effect could have been larger, which is economically inefficient for a country with long-lasting recessions. For the latter, our results indicate that despite the phasing-in, the sanctions still had a significant effect,” Mikhail, Anna and Steven wrote.

The authors want to present their paper at the Asian Meeting of the Econometric Society at the end of June and at the European Economic Association in August.