ANKARA – The Bank of Russia announced yesterday that private investors will be prohibited from buying shares of companies in “unfriendly countries”.
According to Anadolu Agency, the central bank said the decision was taken to reduce risks for unqualified investors.
“From January 1, 2023, brokerages will have to suspend the execution of any order from a non-qualified investor to increase a position in securities of foreign issuers from unfriendly countries,” it said.
It was emphasised that foreign financial institutions could prevent the disposal of acquired assets without any warning and that more than 5 million investors were harmed by such obstructions.
The asset freeze linked to sanctions affects not only wealthy investors but more than 5 million people who bought foreign shares during a retail investment boom at the height of the Covid-19 pandemic, according to central bank data, it reported.
“It is very difficult to protect the rights of these securities’ holders post factum, as the solution to the problem lies outside the Russian jurisdiction,” said the bank.
The bank previously said nearly one-third of around 3 trillion roubles (RM220.2 billion) worth of foreign securities held in Russians’ accounts at the end of March were US-issued.
A majority of Russians bought foreign shares in a retail investment boom during the pandemic. More than 5 million people in Russia have foreign stocks in frozen accounts because of Western sanctions. – Bernama, September 7, 2022
