US Sanctions Kyrgyzstan's Keremet Bank

The US Treasury Department has added Kyrgyzstan's Keremet Bank to its sanctions list, Orda reports, citing Kloop.

This marks the first time a Kyrgyz bank has faced such restrictions.

The January 15 announcement accuses the bank of helping circumvent sanctions imposed on Russia following its invasion of Ukraine.

According to Treasury officials, since mid-2024, Keremet Bank has been working with Russian officials and sanctioned Promsvyazbank (PSB) to facilitate cross-border transfers, effectively creating a "sanctions circumvention center" for Russian trade payments.

 PSB, sanctioned in 2022, has provided billions in support to Russia's defense sector.

While Keremet Bank previously denied being sold to Russian interests, the US Treasury reports that in 2024, the Kyrgyz Ministry of Finance sold its controlling stake to a firm "closely linked to a Russian oligarch." 

Local media reported that the stake had been sold to Luxembourg companies for 850 million soms.

Following its privatization, the bank reportedly underwent leadership changes, appointing Tatiana Kurzhey as Board Chair and Natalia Druzhinina as Head of the Board of Directors - both former executives of Kazakhstan's Eurasian Bank.

Meanwhile, Keremet Bank has announced plans to appeal the sanctions while asserting they won't affect operations.

Kyrgyzstan's National Bank has also stated the banking system remains resilient to various external risks" and well-capitalized.