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ECB Warns UK: Excluding Russia From SWIFT "Could Undermine Confidence In The Whole System"

Tyler Durden's picture




 

As "isolated" Russia signs a military deal with Cyprus, agrees bilateral trade with Greece, ratifies the $100 billion BRICS Bank, and offers to trade advanced anti-aircraft missiles to Iran, it seems threats of more sanctions against Putin and his nation are finding resistance from an unexpected place. With British PM David Cameron re-demanding that Russia be excluded from the SWIFT global financial payments system, none other than ECB Governing Council member Ewald Nowotny has exclaimed, "one has to be very careful here, exclusion of Russia from Swift would be very problematic because it could potentially undermine confidence in this system as a whole."

 

As Der Standard reports (via Google Translate),

A SWIFT exclusion of Russia as a sanction against the EU-Ukraine Moscow because of the crisis had last been suggested by British Prime Minister David Cameron. Nowotny said he had spoken with EU Commissioner for Economic Affairs Pierre Moscovici... the question of the Russia-EU sanctions.

 

"I pointed out that one has to be very careful here," the governor said. Exclusion of Russia from Swift "we would see as very problematic because it could potentially undermine confidence in this system as a whole".

 

Austria would advocate a pragmatic way. His warning was not so much related to Austria, but on the credibility of the SWIFT system. This international payment system should be a neutral service, Nowotny said.

 

For Austria exclusion of Russia from Swift would have no immediate effect. However, Russia could then put retaliation, "and, of course, would have implications for all companies doing business in Russia there". But he assumed that it would not come to such a step. He would not comment on the sanctions, "only if sanctioned, this is not the appropriate field."

*  *  *

Of course, Russia has already created an alternative to SWIFT - as it said it would...as Sputnik News reports,

Almost 91 domestic credit institutions have been incorporated into the new Russian financial system, the analogous of SWIFT, an international banking network.

 

The new service, will allow Russian banks to communicate seamlessly through the Central Bank of Russia.

 

It should be noted that Russia's Central Bank initiated the development of the country's own messaging system in response to repeated threats voiced by Moscow's Western partners to disconnect Russia from SWIFT.

 

...

 

Joining the global interbank system in 1989, Russia has become one of the most active users of SWIFT globally, sending hundreds of thousands of messages per day. In general, SWIFT provides a secure communication network for more than ten thousands of financial institutions around the world, approving transactions of trillions of US dollars.

 

Earlier this month Russian Deputy Prime Minister Igor Shuvalov expressed confidence that Russia would not be disconnected from SWIFT. In her turn, Russian Central Bank First Deputy Chair Ksenia Yudaeva called upon Russian civilians and financial institutions not to dramatize the current situation.

 

Russian experts point to the fact that Western businesses would face severe losses if they expelled Russia from the international SWIFT system. On the other hand, the alternative system launched by Russia might reduce the negative impacts caused by measures imposed by the West, including possible disconnection from SWIFT, and diminish Western financial dominance over Russia.

*  *  *

...and one wonders how destabilizing it would be for the world financial system if Russia decided unilaterally to leave SWIFT?

 

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Thu, 02/26/2015 - 20:25 | 5833515 HonkyShogun
HonkyShogun's picture

I thought the point was to undermine the system?

Thu, 02/26/2015 - 20:44 | 5833585 knukles
knukles's picture

International law/treaties in numerous places includes the exclusion of a country from the international payments mechanism constituting an Act of War.
Go Figure

Thu, 02/26/2015 - 21:03 | 5833661 Winston Churchill
Winston Churchill's picture

Like Iran ?

Thu, 02/26/2015 - 21:10 | 5833687 Oldwood
Oldwood's picture

it doesn't include Muslim States. States governed by the religion of peace are exempt.

Thu, 02/26/2015 - 21:20 | 5833722 Winston Churchill
Winston Churchill's picture

The religion that still bans usury you mean.That and oil explains everything.

Thu, 02/26/2015 - 21:39 | 5833793 TahoeBilly2012
TahoeBilly2012's picture

British and US laptdog Zio puppet "leaders" make me sick, you wonder when their heads will just start spinning ala Exorcist...

Thu, 02/26/2015 - 21:57 | 5833834 Anusocracy
Anusocracy's picture

What if Russia decides to become a banking safe haven free from US laws?

Thu, 02/26/2015 - 22:00 | 5833867 BigJim
BigJim's picture

You know, the more I contemplate the doings of 'our' governments and weigh the good and bad and start defending the actions of one over the other, the more I feel like a chump.

It's like some shop owner who pays protection money to his local mafioso taking sides and debating what's 'best' when 'his' mafia gets in conflict with a neighbouring mafia family.

What a bunch of Stockholmed fools we are; a pox on all their houses!

Thu, 02/26/2015 - 23:52 | 5834182 MrPalladium
MrPalladium's picture

With their own encrypted systems Russia could replace Switzerland as the haven for secret financial accounts.

The U.S. bureaucracy is so large and cumbersome that each department pursues its own agenda without ever thinking about the collateral consequences to other departments and agencies. Cutting Russia off from Swift means that the accounts of American investors in Russia and American execs working for American companies in Russia go dark to the IRS.

Russia may not be quite the vacation paradise to match the Caymans, but then some of the "scenery" in Russia looks pretty damn good!!

Thu, 02/26/2015 - 23:51 | 5834194 MrPalladium
MrPalladium's picture

Dup!!

Fri, 02/27/2015 - 01:31 | 5834449 roadlust
roadlust's picture

They can be bankers for ISIS and Assad.

Thu, 02/26/2015 - 21:37 | 5833790 kiwimail
kiwimail's picture

Who needs swift when you have HKSB and JP Morgan?

Thu, 02/26/2015 - 20:26 | 5833521 Oldwood
Oldwood's picture

not the fucking confidence!!!!!

Thu, 02/26/2015 - 20:27 | 5833526 TeamDepends
TeamDepends's picture

The Queen Mum
She's had some good fun
But the shapeshiftin' snakes
Are now on the run!

Thu, 02/26/2015 - 20:28 | 5833529 giovanni_f
giovanni_f's picture

Keep on playing with fire, western leaders. Your death wish might be fulfilled sooner than you think.

Thu, 02/26/2015 - 21:05 | 5833667 WhackoWarner
WhackoWarner's picture

Zion Protocol number??? I keep getting them all mixed up,  Like being puppy being trained, I am confused by the crosstalk and mixed messages.  What's a poor serf to do?

Thu, 02/26/2015 - 21:10 | 5833690 nmewn
nmewn's picture

Zion Protocol number???

That would be...47544.

Oh wait, thats Frank Marshall Davis' Communist Party number.

My bad ;-)

Thu, 02/26/2015 - 22:10 | 5833894 396
396's picture

It's a death cult. I"m dreaming of the day the world goes "Jim Jones" on their asses. They've already drank the kool-aid.

Thu, 02/26/2015 - 20:30 | 5833532 dirtyfiles
dirtyfiles's picture

soon EU to be in bed with Russia by my observations

Thu, 02/26/2015 - 20:32 | 5833546 ParkAveFlasher
ParkAveFlasher's picture

They've been in bed for 2,000 years.  The American citizen is the mark here.

Thu, 02/26/2015 - 20:37 | 5833562 surf0766
surf0766's picture

As designed by Dear Leader

Thu, 02/26/2015 - 22:53 | 5834023 Salah
Salah's picture

yep, they've realized which side their borscht is buttered...

Thu, 02/26/2015 - 20:29 | 5833533 wendigo
wendigo's picture

Putin may indeed be a valiant man standing up to a corrupt and evil empire. Maybe. If he is, he will probably fall. The lion sign is too strong. 

Thu, 02/26/2015 - 20:29 | 5833534 Winston Churchill
Winston Churchill's picture

Woar, if the west does it.

Woar when Russia does.

Hobsons choice,

Thu, 02/26/2015 - 20:40 | 5833567 kowalli
kowalli's picture

west has cornered himself, he can't do damage without selfdestraction

Thu, 02/26/2015 - 20:47 | 5833593 knukles
knukles's picture

And all in it's final analysis, for no rational reason whatsoever.  Let the pipelines be built, the external trade treaties take place, the world will turn and the follies of men dissolve as they have in the past.  Left alone, things will simply work out.  Ignoble activities such as those being pursued suffer only tragic and expensive outcomes.

Fri, 02/27/2015 - 00:41 | 5834343 nowhereman
nowhereman's picture

Knukles, your astuteness is astounding

Thu, 02/26/2015 - 20:37 | 5833539 Thirst Mutilator
Thirst Mutilator's picture

Tough talk from the same platform where Gordo sold a huge chunk of their gold at firesale prices.

 

What a maroon!

Thu, 02/26/2015 - 20:30 | 5833540 eyesofpelosi
eyesofpelosi's picture

Not so swift then?

Thu, 02/26/2015 - 20:31 | 5833545 Son of Captain Nemo
Son of Captain Nemo's picture

That must be why this is  happeing right about now along with 50,000 dead men women and children and counting in that civil war that the U.S. started last year.

Hope Russia and China send D.C., London and Tel Aviv to the moon!!!

Thu, 02/26/2015 - 20:33 | 5833549 disabledvet
disabledvet's picture

The ECB gave the warning?

 

I don't understand.  Aren't they suppose to be monetizing all of Ukraine's debt?

 

What passes for "currency" over there these days anyways?

 

At least Greece has a "gold mine." 

 

The problem is that the numbers don't make any sense.  Obviously Europe could pass a "gold price rule" as well...that would probably strongly motivate investment in Greece actually.

Thu, 02/26/2015 - 20:34 | 5833553 stant
stant's picture

Ask the Turks what they think

Thu, 02/26/2015 - 20:40 | 5833569 erk
erk's picture

I think I read recently on ZH that Russia is responsible for a huge percentage of SWIFT transactions. If they were excluded the impact would send a shockware for sure.

 

Thu, 02/26/2015 - 20:42 | 5833576 kowalli
kowalli's picture

Russia have second place with banks number in the world

Thu, 02/26/2015 - 20:41 | 5833572 FieldingMellish
FieldingMellish's picture

Nonsense. As usual, nothing will happen. We have been knocking at the doors of collapse for so long that I don't thing anyone is at home.

Thu, 02/26/2015 - 20:49 | 5833603 dirtyfiles
dirtyfiles's picture

Russia bought a lot of gold recently and get rid of US treasuries together with China

this are clear intentions

http://www.zerohedge.com/news/2014-12-15/china-russia-dump-us-treasurys-...

Fri, 02/27/2015 - 06:37 | 5834681 winchester
winchester's picture

F.M :

 

do you know the story of the kid always yelling " wolf wolf ", when nothing happens in reality, until the day ppl were no more listening the kid the day he really saw wolves ?

 

that's the problem, that makes elite's excuse " we did not see it coming, this time it is different"  overestimating  stuff all the time, until...it comes..

Thu, 02/26/2015 - 20:49 | 5833581 Theta_Burn
Theta_Burn's picture

Yes David the camera is on...

As bad as we have it here in the states with the hip-hop prez0, I can't imagine the embarrassment felt by you poor Brits..

Hey Dave, why not follow Estonia's rented valet example, reposition 30 armored personel carriers around Stonehenge ...at night.. and call it a NATO exercise.

That will fuck with em...

Putz

Thu, 02/26/2015 - 21:55 | 5833853 BigJim
BigJim's picture

Cameron... Obama... Cameron... Obama...

Nope, sorry, I can't say that I see that Cameron is actually worse than the Big O.

Fri, 02/27/2015 - 03:22 | 5834576 plongka10
plongka10's picture

Oh the irony! Stonehenge is literally next door to an army base and the Salisbury Plain training area. Lulz

Thu, 02/26/2015 - 20:58 | 5833627 jerry_theking_lawler
jerry_theking_lawler's picture

The setup is obvious. Russia is setting up an alternative to SWIFT. Russia is buying gold. Russia is stopping the West in Syria.  It is obvious Russia is tired of the USSAs shit and is getting ready to pull the plug and move away to their own systems. They will quickly bring in the BRICS and the Russian eurasian economic union next....then dare the USSA to start a war.

Thu, 02/26/2015 - 22:00 | 5833872 Stumpy4516
Stumpy4516's picture

This Russian system is just so that 91 banks within Russia can communicate without outside assistance.  That should have been done ages ago.  No time line has even been given for when, if ever, it will accomodate other nations other than China.  The last I read China would not be connected for several years.

Syria is largely destroyed and the destruction is ongoing.  Nothing has been stopped.  TPTB could not blame Syria for the poison gas and thus have not had an event they could sell the sheep at home as justification for finishing the job quickly.  That appears to be changing with the new boots on the ground to "fight" ISIS and the increased bombing in Syria. 

 

Thu, 02/26/2015 - 22:46 | 5834003 Flagit
Flagit's picture

This is not an attack.

Would like to see a link for China not connecting for several years.

Also, Assad's head-on-a-stick has not made a cameo appearance in an ISIS video, soooo I would say they were definitely stopped in Syria. Remember the naval "blockade" and failed Tomahawk "test"?

Fri, 02/27/2015 - 00:53 | 5834381 Stumpy4516
Stumpy4516's picture

I'll look briefly via google for a reference.  I think it might have been here on ZH.

Do you have any link to an official announcement from Russia about this system being operational for China sooner?

They are bombing Syria on a regular basis.  The denial by many on ZH that Syria is already largely destroyed, citizens having vacated many towns and that the situation is not under control is fantasy.  The Tomahawk diverting was a success.  The blockade has not been.  Planes fly right into Syria and kill.  Has one of those Russia ships fired a single shot to protect Syria? Why does Russia not announce a no fly zone over Syria just like the US has repeatedly done against the will of soverign countries?

The attitude that all is right in Syria and the insurgents have been stopped unless Assad's head is on a stick pretty well sums up the wishful thinking found here.  I guess those same people also believed Iraq had stopped the invaders right up to the time Saddam was finally hanged.

Fri, 02/27/2015 - 07:24 | 5834720 Winston Churchill
Winston Churchill's picture

Syria became a dispenable pawn with the advent of Crimea and the new port facility

agreement with Iran.Bringing Turkey into the Russian spere also blocks the pipeline.

You pick your battleground, and its Iran, soon to be a full member of the SCO.

Fri, 02/27/2015 - 02:34 | 5834530 indygo55
indygo55's picture

These things that they do, they are done well before they are announced. We have little knowledge of what they are really doing in totalality. We are told through announcements what they will allow to be announced. I will bargain to think they have a bit more going on then we are told. 

Thu, 02/26/2015 - 21:01 | 5833649 Son of Captain Nemo
Son of Captain Nemo's picture
ECB Warns UK: Excluding Russia From SWIFT "Could Undermine Confidence In The Whole System"

Just how significant is this little SWIFT thing to the Western banks?...

This important!!!

Thu, 02/26/2015 - 22:45 | 5834000 Wahooo
Wahooo's picture

Russia is the biggest user if I recall correctly.

Thu, 02/26/2015 - 21:02 | 5833654 me or you
me or you's picture

This will be the last step before the nukes start falling in Washington DC I'm pretty sure that will be the first place to be hit by the Russian nukes. "A snake without head is not a snake"

Thu, 02/26/2015 - 21:06 | 5833674 Winston Churchill
Winston Churchill's picture

Its the only way to be sure.

Thu, 02/26/2015 - 21:16 | 5833710 me or you
me or you's picture

Let's make sure we have some champagne to celebrate the destruction of Washington DC when that day comes.

Thu, 02/26/2015 - 21:23 | 5833732 Winston Churchill
Winston Churchill's picture

Is there somewhere we can donate ?

Thu, 02/26/2015 - 21:26 | 5833745 me or you
me or you's picture

We can have some boxes ready to be distributed in the neighborhood. We can use the churches and the schools.

Thu, 02/26/2015 - 22:32 | 5833965 IndianaJohn
IndianaJohn's picture

Why Champagne? Good tasting well water would be good enough. Just as healthy as Chanpagne for a lot less $.

Thu, 02/26/2015 - 23:47 | 5834175 oncefired
oncefired's picture

Maybe just an EMP so we can save the buildings for when we have to restart the republic?

Fri, 02/27/2015 - 06:42 | 5834685 winchester
winchester's picture

restart = again.

 

lets play tribal like planet of ape style, funnier,  all busy to sharp sticks, no politics involvment.

 

you will be able to go fun hunting in missouri

Fri, 02/27/2015 - 00:33 | 5834323 nowhereman
nowhereman's picture

God I hope Obama is at home at the time.

Thu, 02/26/2015 - 21:02 | 5833657 bytebank
bytebank's picture

Why do we give a shit about Ukraine all of a sudden? We really want war with Russia to gorge on the left overs? This is so crazy.

We could not fuck up Iran for 30'years so why do we think we can do this to Putin? What is the angle?

Who is going to get rich?

Thu, 02/26/2015 - 21:19 | 5833718 Oldwood
Oldwood's picture

the best plan is to pick on those least able to fight back. Obama does not believe in American exceptionalism but he still thinks he can throw his/our weight around without blow back. If you have seen him with a gun in his hands you know what we are dealing with.

Thu, 02/26/2015 - 22:13 | 5833906 NidStyles
NidStyles's picture

I'm going to have to search that image. It has to be funny with how he handles himself in the gym...

Thu, 02/26/2015 - 21:26 | 5833744 sun tzu
sun tzu's picture

Lots of precious metals, oil and gas in Russia. Ukraine is just an excuse to take over. 

Fri, 02/27/2015 - 01:22 | 5834434 kianator
kianator's picture

It is crazy!  But, Russia's state controlled media propaganda campaign is making it sound like war is around the corner with the US and NATO.  What they are really trying to do is distract the people of Russia from the recessionary economy, low oil prices, the ever expanding police state, and widespread corruption in Russia The US really does not have any real strategic VITAL interests in the Ukraine.  Not vital enough for US and NATO to send combat troops to the Ukraine and fight the Russians in their own backyard.  Yes, a Pro-Western regime in the Ukraine is a nice thing, but not worth going to war with the Russians, which could go nuclear.  In the worst case, if Russian's invaded, conquered, and installed a pro-Russian regime in the Ukraine, it would not change anything.  Yes, more sanctions against Russia, but it doesn't go past that unless trouble starts in the Baltics or elsewhere.

Thu, 02/26/2015 - 21:17 | 5833715 Quick
Quick's picture

This is all so Biden jr. Can have his own country ?!

Thu, 02/26/2015 - 21:20 | 5833725 me or you
me or you's picture

As of right now Ukraine is burning in flames.: Police disperse protesters at Ukraine National Bank

Thu, 02/26/2015 - 21:45 | 5833799 tony wilson and...
tony wilson and saturn zion devils's picture

putinic is a bully.

the china man has plastic dollar store weapons

the russian has rockets made of wood they can only fly in the dry as when wet they bend

butt anyway already

only zion and david cam moron can put the new hilter in his place.

enough anne franks have died already during the w w 2 wars.

we cannot allow more jews to suffer without a compensation package being in place.

no dollars

just gold

the rabbi must not be messed with

without a pain in the wallet or purse

Thu, 02/26/2015 - 22:28 | 5833952 IndianaJohn
IndianaJohn's picture

HaHa, that's a good one Tony.

Thu, 02/26/2015 - 22:44 | 5833995 Wahooo
Wahooo's picture

I can't wait for the US military to be soundly defeated, its ships lying at the bottom of the seaans its warplanes in acrid smoldering heaps.

Thu, 02/26/2015 - 21:47 | 5833824 shovelhead
shovelhead's picture

My Uncle Beauford told me once, "If you're commencin' a pissin' contest, best not to step on y'own dick."

God bless his cankerous old soul.

Thu, 02/26/2015 - 21:53 | 5833846 Vinividivinci
Vinividivinci's picture

I dont know if Putin is for real but damn, I'd vote for him anyday over cameron/Obama/Harper.
At least Vlad has a clue on how the game is played.

Thu, 02/26/2015 - 22:41 | 5833983 tony wilson and...
tony wilson and saturn zion devils's picture

I dont know if Putin is for real but damn,

 

 

that sounds like queer talk my man.

here at the soros institute branch of chatham house at the united service tavistock institute

we deal in facts and files and docu munts

the fact is my man that putin is clearly a gay man my man

and not to be trusted.

he wants tp take away the last sheckles of us poor imf israelites

already

 

Thu, 02/26/2015 - 22:01 | 5833873 will ling
will ling's picture

the crosshairs. i really can't fathom why vlad (and team) just don't swiftly roll over europe. what have they got to lose?

Thu, 02/26/2015 - 22:40 | 5833986 Wahooo
Wahooo's picture

History an their freedom.

Thu, 02/26/2015 - 22:16 | 5833909 Stumpy4516
Stumpy4516's picture

The big military deal simply allows Russia to dock some ships for refueling and supplies and from what I remember for them to continue to have some maintenance personnel on land.  There is not airport with military planes being stationed, no naval base, no troops - just allowed to dock some ships.

The $100 billion BRICS bank is less than 2 months of Fed printing.

Thu, 02/26/2015 - 22:17 | 5833912 Longarm
Longarm's picture

Barry Obammy was a man, was a BIG man, but the bear was bigger so he ran like a nigger up a tree.

Thu, 02/26/2015 - 22:39 | 5833984 Flagit
Flagit's picture

The British politburo seems to be much like a spoiled child playing a game.

They constantly change the rules when they are not winning, scorns anyone that questions the rules, and finally throws a temper tantrum and threatens to take their game home, since it's theirs anyway, if you can't let them win by constantly changing rules.

Thu, 02/26/2015 - 23:04 | 5834051 Atomizer
Atomizer's picture

SWIFT shell game will be exposed under names and addresses. It won't be pretty for the wankers shoveling new laws to receive a kick-back.

Fri, 02/27/2015 - 00:21 | 5834285 Flybyknight
Flybyknight's picture

Cameron has a peanut for a brain. Every western effort to provoke Russia has backfired. This one will too. Just remember if WWIII starts the responsible parties are Cameron, Obama, Merkel,Hollande, Nato, anyone in the GOP, anyone in the Democrats.

Fri, 02/27/2015 - 00:23 | 5834294 Flybyknight
Flybyknight's picture

Re previous comment: I forgot Harper  and Abbott but then who wouldn't

Fri, 02/27/2015 - 00:45 | 5834354 nowhereman
nowhereman's picture

Do you ever get the feeling that you are snookered?

Fri, 02/27/2015 - 03:03 | 5834560 Jano
Jano's picture

Expell Russia.

RUssia will expand their own system further, make the life of their oligarchs more difficult and expand its own "SWIFT" system, maybe excluding the "West".

Fri, 02/27/2015 - 04:15 | 5834601 Victor999
Victor999's picture

Cameron and his relationship with Obama brings to my mind Salacious B. Crumb,the Kowakian monkey-lizard, and his relationship to Jabba the Hutt.

Fri, 02/27/2015 - 09:57 | 5834959 gcjohns1971
gcjohns1971's picture

Screw the bankers!

Finance should not be used as an insturment of arbitrary power-politics between nations.

Using the elements of power in a hostile manner is warfare.  

It should not be used unless the stakes are appropriate to justfy the risk of open warfare - and then only after a public debate.

The world, both east and west, is being led by power-hungry juveniles with a deficit of caution and a surplus in self-confidence.

Fri, 02/27/2015 - 17:35 | 5836872 krage_man
krage_man's picture

SWIFT is mostly settlement messaging system.

Actually, SWIFT.NET is the network, but anyone can create its own network, like Russia did, which passes messages beetween adressants with BIC addresses. Some banks use it between branches.

The problem with current SWIFT is that all messages are intercepted by US hub, so no banking privacy exists - at some point EU was pressed to do it.

So, building a new independant network will be a positive thing.

 

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