The paper explores the effects of financial sanctions on Russian banks looking at individual-account cross-border transactions. Findings indicate that sanctions, especially disconnection from SWIFT and fund freezes, significantly reduced financial transactions. Inflows and outflows of payments of sanctioned Russian banks in TARGET2 were effectively reduced by up to 92% . Results for a sample including Belarus are the same. Spillovers to non-targeted banks and countries are negligible. Potential evasion of sanctions through other payment systems (such as CIPS, not observed) cannot be ruled out.
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