UK investors given opening to dump Russian derivative

The British government recently announced that UK investors will have a six-week window in which to unload any holdings in securities repurchase agreements and derivatives issued by any institutions that are part of the Russian government.

The Treasury stated that British investors can use financial firms to sell any derivatives, reverse repurchase transactions and repurchase agreements that were entered into prior to March 1 with the National Wealth Fund of the Russian Federation, the Central Bank of the Russian Federation, or the Ministry of Finance of the Russian Federation.

Investors were also informed by the Treasury that they will also be able to wind down their repo agreements and derivatives under a licence that will be valid from until May 2. However, the UK government reserves the right to suspend or revoke the licence at any time they deem fit.

This permission is provided to investors via a general licence issued by Britain’s sanctions enforcer, the Office of Financial Sanctions Implementation.

The move enabling UK traders to unload Russian government repo and derivatives positions is coming at a time when Britain has imposed broad sanctions on Moscow as a response to the invasion of Ukraine. These measures include assets of individuals who are close to President Vladimir Putin being frozen, and stopping Russian banks from accessing sterling and being able to clear payments in the UK.

Investors seeking to take the best course of action following changes to legislation and market shifts often seek out investment advice in Shropshire and other affluent parts of the country.

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