Jamie Dimon, CEO and Chairman of JPMorgan Chase, gestures during his speech during the U.S. Senate Banking, Housing and Urban Affairs Committee hearing on oversight of Wall Street firms on Capitol Hill on December 6, 2023 in Washington, DC
Evelyn Hockstein | Reuters
A Russian court sided with state lender VTB Bank in its efforts to recover $439.5 million JPMorgan Chase that the American lender froze US accounts after the invasion of Ukraine.
The court ordered the seizure of funds in JPMorgan’s Russian accounts as well as “movable and immovable assets,” including the bank’s stake in a Russian subsidiary, according to a court order released Wednesday.
The order came after VTB filed a lawsuit with an arbitration tribunal in St. Petersburg last week seeking redress for funds frozen in the U.S. and seeking relief because JPMorgan announced it would exit Russia.
The next hearing in the Russia case will take place on July 17.
JPMorgan declined to comment. VTB did not immediately respond to CNBC’s request for comment.
The order was the latest example of American banks caught between the demands of Western sanctions regimes and foreign interests. JPMorgan is the largest U.S. bank by assets and is led by veteran CEO Jamie Dimon.
Two years after Russia’s invasion of Ukraine, the Biden administration has imposed an unprecedented series of sanctions, oil price caps and trade restrictions to weaken Moscow’s military machine.
On Wednesday, President Joe Biden signed a sweeping foreign aid bill that provides new powers for U.S. officials to locate and seize Russian assets in the United States. It also bolstered ongoing American efforts to persuade European allies to release Russian state assets to support Ukraine.
In its own lawsuit against VTB last week in the Southern District of New York, JPMorgan sought to block VTB’s efforts, pointing out that U.S. law prohibits the bank from releasing VTB’s $439.5 million.
This leaves JPMorgan exposed to a loss of almost half a billion dollars due to compliance with US sanctions.
The American bank that sought to block VTB’s efforts said the Russian company had broken its contractual promise to seek relief in American courts and instead found a more favorable venue in Russia.
JPMorgan said Russian courts have allowed similar efforts by Russian lenders against American or European banks at least half a dozen times.
JPMorgan said it had suffered “certain and irreparable harm” as a result of VTB’s efforts.
Don’t miss these exclusives from CNBC PRO
- Here are Thursday’s biggest analyst calls: Nvidia, Meta, Tesla, IBM, UPS, Five Below, Amazon, TJX Companies and more
- Here’s where the pros say you should invest $1 million right now
- Forget Nvidia: Morgan Stanley says Intel’s much-touted AI chip will boost three global stocks
- These five stocks will power the AI revolution as data centers proliferate and power demand doubles, Bank of America says
- Profit Playbook: Your guide to trading with a huge week of reports including meta platforms
Source link
2024-04-24 22:24:46
www.cnbc.com
