By Alexander Kolyandr
MOSCOW--The Russian ruble strengthened and stock market rose on
Tuesday as a new wave of Western sanctions appeared to be softer
than expected.
The U.S. and Europe imposed sanctions on a slate of new Russian
government officials and business entities in an effort to pressure
President Vladimir Putin and his Ukrainian allies to cease military
activity in eastern Ukraine.
However, despite widely circulated rumors that a number of
leading Russian publicly traded companies--including banks and
energy firms--may be on the list, only privately owned companies
connected with people already sanctioned appeared on the list.
"In anticipation of new sanctions, markets were indubitably
prepared for a number of grim scenarios. The publication of the
latest list thus was taken with a considerable degree of relief,"
Russia's largest lender Sberbank said.
Sobinbank, one of the sanctioned banks, said in a statement to
clients that the move would not impede its operations any further,
as it has been under de facto sanctions for a month after its
owner, Rossija Bank, was targeted in March.
International payment systems Visa Inc. and MasterCard Inc. in
March stopped servicing Bank Rossiya and three banks connected with
it--Sobinbank, InvestCapitalBank and SMP Bank. The payment systems
resumed services to two of the banks briefly, but stopped again
after they were sanctioned on April 28.
SMP Bank, controlled by the already sanctioned brothers Arkady
Rotenberg and Boris Rotenberg, informed customers about the
sanctions on its website, and asked them to use their cards only to
withdraw cash and not to wire any foreign currency. The bank also
stopped taking deposits in foreign currency, but promised to
service all of its obligations in rubles.
IvestCapitalBank also asked clients not to use cards other than
for withdrawing cash, but promised to continue services as
usual.
Russian State Technology Corporation Rostec, whose Chief
Executive Sergey Chemezov was sanctioned Tuesday, said
"restrictions introduced will not prevent him from performing his
duties nor will they affect the operations of the companies in
which" he is a board member.
The U.S. put a number of non-public companies controlled by
Gennady Timchenko, sanctioned in March, on the new list , but left
natural gas company Novatek, in which he owns just below 25%,
untouched. Shares in Novatek gained 1.2%, outperforming both the
wider market and the peers.
Construction firm Mostotrest, in which Arkady Rotenberg controls
just above 25%, was also not sanctioned, and its shares were up
almost 1% in the first half of the day, but then lost some of its
gains.
The market itself was up Tuesday, with Micex trading up almost
0.9% during the day. The ruble strengthened 0.7% against the
dollar, while Russia's 30-years sovereign bonds rose 1 percentage
point.
But Russia doesn't appear to take the sanctions lightly. Deputy
Foreign Minister Sergei Ryabkov said Tuesday "the seriousness of
the sanctions is obvious to us, particularly in the high-tech
sector, the U.S. import that can be used in defense, and in space
industry".
Write to Alexander Kolyandr at Alexander.Kolyandr@wsj.com