JPMorgan Chase CEO and Chairman Jamie Dimon gestures as he speaks throughout the U.S. Senate Banking, Housing and City Affairs Committee oversight listening to on Wall Avenue corporations, on Capitol Hill in Washington, D.C., on Dec. 6, 2023.
Evelyn Hockstein | Reuters
A Russian court docket sided with state-run lender VTB Financial institution in its efforts to recoup $439.5 million from JPMorgan Chase that the American lender froze in U.S. accounts after the Ukraine invasion.
The court docket ordered the seizure of funds in JPMorgan’s Russian accounts and “movable and immovable property,” together with the financial institution’s stake in a Russian subsidiary, in response to a court docket order revealed Wednesday.
The order got here after VTB filed a go well with final week in a St. Petersburg arbitration court docket, searching for to be made complete for funds frozen within the U.S., and asking for reduction as a result of JPMorgan has mentioned it plans to exit Russia.
The following listening to within the Russian case is July 17.
JPMorgan declined to remark. VTB didn’t instantly reply to CNBC’s request for remark.
The order was the most recent instance of American banks getting caught between the calls for of Western sanctions regimes and abroad pursuits. JPMorgan is the largest U.S. financial institution by belongings and run by veteran CEO Jamie Dimon.
Two years after Russia invaded Ukraine, the Biden administration has mounted an unprecedented set of sanctions, oil worth caps and commerce restrictions designed to weaken Moscow’s navy machine.
On Wednesday, President Joe Biden signed into regulation a sweeping international support invoice that features new powers for U.S. officers to find and seize Russian belongings within the U.S. It additionally boosted an ongoing American effort to persuade European allies to launch Russian state belongings to help Ukraine.
In its personal lawsuit in opposition to VTB final week within the Southern District of New York, JPMorgan sought to dam VTB’s effort, noting that U.S. regulation prohibits the financial institution from releasing VTB’s $439.5 million.
This leaves JPMorgan uncovered to an almost half-billion-dollar loss, for abiding by U.S. sanctions.
The American financial institution, searching for to dam VTB’s effort, mentioned the Russian firm broke its contractual promise to hunt reduction in American courts, as an alternative discovering a friendlier venue in Russia.
JPMorgan mentioned Russian courts have enabled comparable efforts by Russian lenders in opposition to American or European banks not less than a half dozen different occasions.
JPMorgan mentioned it confronted “sure and irreparable hurt” from VTB’s efforts.
