# Financial screws turned on Russia as insurers exit, London stocks halted
Author:  Pal Sinha, Barnali 
Author URL: https://financedigest.com/author/pal-sinha-barnali
Published: 2022-03-04
Category: INVESTING
Category URL: https://financedigest.com/category/investing
Meta Title: London Stock Exchange suspends Russian trading amid global
Meta Description: LSE suspends Russian securities trading, insurers withdraw cover. Banks, investors exit investments, halt services. Global pressure on Russia's economy.
URL: https://financedigest.com/financial-screws-turned-on-russia-as-insurers-exit-london-stocks-haltedhtml

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By Carolyn Cohn and Lawrence White

LONDON (Reuters) -Russia’s global financial isolation intensified on Friday as the London Stock Exchange (LSE) suspended trading in its last Russian securities and some insurers withdrew cover from exporters over Moscow’s invasion of Ukraine.

Banks, investors and insurers have in recent days ratcheted up that pressure by exiting investments in Russia and halting the provision of their services.

The LSE said it had suspended global depositary receipts (GDRs), which represent shares in a foreign company, for eight Russian companies, including Magnit and Sistema, after freezing [trading in 28 firms](https://www.financedigest.com/increasing-regulatory-red-tape-promptsa-new-approachto-trading-data-management-among-fs-firms.html "Increasing regulatory red tape prompts a new approach to trading data management among FS firms") on Thursday.

The trading halts come as Britain, the European [Union and the United States](https://www.financedigest.com/ukraines-first-lady-to-be-guest-of-honor-at-eu-state-of-union.html "Ukraine’s first lady to be guest of honor at EU State of Union") continue to roll out financial sanctions on Russia to prevent its companies from accessing Western markets.

In another turning of the screws on Moscow, trade credit insurers, who [provide a financial](https://www.financedigest.com/mazars-to-acquire-financial-modelling-consultancy-and-training-provider-corality-financial-group.html "Mazars to acquire financial modelling consultancy and training provider, Corality Financial Group") safety net for exports and imports, are pulling back from covering businesses exporting to Ukraine and Russia given the risks of sanctions, high claims or missed payments, industry sources said.

The move in the nearly $3 trillion [global market will heap further pressure](https://www.financedigest.com/asias-factory-activity-weakens-on-global-slowdown-cost-pressures.html "Asia’s factory activity weakens on global slowdown, cost pressures") on Russia’s already teetering economy.

In this last week, trade [credit insurers will have paused supporting new risk](https://www.financedigest.com/jaywing-releases-horizon-a-new-ifrs-9-modelling-solution-that-encapsulates-its-extensive-credit-risk-expertise.html "Jaywing releases Horizon, a new IFRS 9 modelling solution that encapsulates its extensive credit risk expertise") for Ukraine and Russia,” said Nick Robson, global leader for credit specialties at insurance broker Marsh.

European Union officials are also examining curbing Russia’s influence and [access to finance](https://www.financedigest.com/700000-employees-across-the-uk-have-access-to-fair-finance-will-reach-one-million-employees-in-2017.html "700,000 Employees Across The UK Have Access to Fair Finance, Will Reach One Million Employees in 2017") at the International Monetary Fund following the invasion, six officials told Reuters. \[L2N2V71XO\]

“For its part, Washington will continue to embrace multilateral sanctions, \[and\] target the [wealth of Russian](https://www.financedigest.com/permitted-share-of-chinas-yuan-in-russian-wealth-fund-doubled-to-60-finance-minister.html "Permitted share of China’s yuan in Russian wealth fund doubled to 60% -Finance Minister") oligarchs as part of a pressure campaign,” Isaac Boltansky, policy director for brokerage BTIG wrote in a note on Friday.

INVESTORS OUT

British insurer and asset manager Royal London became the latest Western investor to say it will [sell](https://www.financedigest.com/uks-cineworld-to-not-sell-assets-individually-denies-talks-with-amc.html "UK’s Cineworld to not sell assets individually, denies talks with AMC") its Russian assets as soon as possible, after a rush of similar announcements in recent days.

We can’t [trade these things](https://www.financedigest.com/3-things-you-didnt-know-about-trading.html "3 Things you didn’t know about trading") anyway, but as soon as we can, we obviously intend to divest,” Royal London Chief Executive Barry O’Dwyer told Reuters.

The [CEO of another major](https://www.financedigest.com/deutsche-telekom-reaches-majority-stake-in-t-mobile-u-s-ceo.html "Deutsche Telekom reaches majority stake in T-Mobile U.S. – CEO") British investment group, Schroders, said on Thursday Russian stocks and bonds are now “in the realms of utterly uninvestable.

Swiss [wealth manager](https://www.financedigest.com/wealth-management-consultant.html "Wealth management consultant") Julius Baer has halted new business with wealthy Russians, two sources familiar with the bank’s operations told Reuters.

Some investors are however piling into funds linked to Russia, [seeing current distressed levels](https://www.financedigest.com/fraport-sees-2023-passenger-traffic-at-80-90-of-pre-pandemic-levels.html "Fraport sees 2023 passenger traffic at 80-90% of pre-pandemic levels") as a potentially cheap entry point for Russian assets.

Deutsche Bank said it has been stress-testing its operations in Russia, where it employs some 1,500 workers in a major technology centre, as [banks with a significant Russian presence grapple with the ramifications of its growing financial](https://www.financedigest.com/why-banks-could-stand-to-learn-a-thing-or-two-about-financial-inclusion-from-fintechs.html "Why banks could stand to learn a thing or two about financial inclusion from fintechs") isolation.

[(Reporting by Carolyn Cohn and Lawrence White, additional reporting by Michelle Price](https://www.financedigest.com/ikea-reports-record-sales-as-price-hikes-offset-weakening-consumer-confidence.html "IKEA reports record sales as price hikes offset weakening consumer confidence"), Tom Sims and Frank Siebelt in Frankfurt, editing by Alexander Smith, Jonathan Oatis and David Gregorio)


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