UAE cites ‘sanctions risks’ as it cancels licence for Russia’s MTS Bank

UAE cites ‘sanctions risks’ as it cancels licence for Russia’s MTS Bank

The United Arab Emirates has cancelled the licence of Russia’s MTS Bank and ordered it to wind down its operations in the Gulf state, citing the “sanctions risks” associated with the lender.

The decision comes as the region’s dominant trade and financial hub has been facing US pressure over western concerns that it is becoming a haven for Russian sanction busting.

The UAE’s central bank said in a statement on Friday that it “has been decided to cancel MTS Bank’s Abu Dhabi licence, wind down its operations within six months from the date of the decision . . . and close the branch”.

“This decision comes after considering the available options regarding the new status of the MTS Bank, and taking into account the sanctions risks associated with the bank after the designation,” the central bank said.

“During the winding down, the branch will be prohibited from opening new accounts and conducting transactions, except for clearing prior obligations and the bank’s use of central bank’s payment systems will be restricted to this purpose only.”

MTS Bank, which is a subsidiary of Russia’s largest mobile operator, Mobile TeleSystems, had sanctions imposed by the US and UK last month as part the waves of sanctions that the west has imposed on