One of Turkey’s largest banks has halted the use of the Russian Mir payment system after warnings from Washington about the risk of falling foul of US sanctions on Moscow.
A spokesperson for İşbank, a private lender, said the bank had temporarily suspended the use of the payment network while it evaluated new guidance from the US.
The move comes after warnings, first reported in the Financial Times last week, that western officials were planning to step up pressure on Turkey over possible sanctions evasion in the country and were looking at the Mir system as a potential backdoor for illicit finance.
Guidance later published by the US Treasury warned banks outside the US that enter into new or expanded agreements with the operator of the payment network would “risk supporting Russia’s efforts to evade US sanctions”.
İşbank is one of five Turkish banks, along with VakıfBank, Ziraat Bank, DenizBank and Halkbank, that are members of the Mir payment system developed by Russia’s central bank as a domestic alternative to Visa and Mastercard.
Two of those — UAE-owned private lender DenizBank and state-controlled Halkbank — signed up to Mir after Vladimir Putin launched his full-scale invasion of Ukraine in February.
DenizBank and VakıfBank said they had seen the reports of İşbank’s decision to suspend Mir operations but added that there was no immediate change in their policies.
Halkbank and Ziraatbank did not immediately respond to a request for comment submitted after working hours.
Turkish officials have insisted that, while their country has not signed up to western sanctions aimed at punishing Putin for the invasion, they will not allow their country to become a hub for sanctions evasion.
But President Recep Tayyip Erdoğan has alarmed US and EU officials with his promises to deepen economic co-operation with Moscow.
Erdoğan, whose country has been a Nato member since 1952, condemned the Russian invasion of its neighbour and a company co-owned by his son-in-law has supplied armed drones to the Ukrainian armed forces. He has also acted as a mediator, helping to secure a deal that has allowed more than 3.6mn tonnes of grain to be exported from Ukrainian ports that were previously blockaded by the Russian military.
But the Turkish president has also courted closer ties with Russia, which is a crucial supplier of natural gas to his country.
Last week, he was pictured walking arm-in-arm with Putin at a meeting of the Shanghai Cooperation Organization in Uzbekistan. He said Turkey would seek to become a member of the Chinese-led club — a move that, if successful, would make his nation the first Nato member state to join the alliance.