The EU considers Russian bank concession to safeguard Black Sea grain deal.

The EU is considering to allow a Russian bank under sanctions to carve out a subsidiary that would reconnect to the global financial network, as a sop to Moscow aimed at safeguarding the threatened Black Sea grain deal that allows Ukraine to export food to global markets.

The plan, which was proposed by Moscow through negotiations brokered by the UN, would allow Russian Agricultural Bank to create a subsidiary to handle payments related to grain exports. The entity would be permitted to use the global Swift financial messaging system, which was closed to the largest Russian banks last year.

The bank carve out was discussed by EU leaders at a summit in Brussels last week, as a potential means to convince Moscow to extend the Black Sea agreement beyond its July 17 expiry date.

The idea was seen by its supporters as “the least worst option” to secure Vladimir Putin’s support for an extension. Officials said that Russia’s’ threats to end the deal appeared more serious this time than during previous extension negotiations.

The proposal is assessed by EU officials as to its legality and feasibility. Complicating the issue is that the Russian Agricultural Bank is fully owned by the Kremlin and its former chief executive, Dmitry Patrushev, is the current agriculture minister and the son of Nikolai Patrushev, a Putin aide and secretary of Russia’s security council who has been instrumental in pushing the war against Ukraine.
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🔗 https://www.ft.com/content/d3e5c2df-3ba2-4420-a115-e437214ad509