People in Russia are withdrawing billions from the nation’s banks over fears that the Kremlin could begin to seize money to finance the war with Ukraine, a report says.
According to The Washington Post, the country is seeing a record cash outflow amid intensifying drone strikes from Ukraine.
Nearly 286.4bn rubles (worth $3.4bn) was withdrawn in the first two weeks of August, according to data from the Russian Central Bank, reported in The Post.
That follows $7.3bn withdrawn last month and more than $4.5bn in June.
Alexandra Prokopenko, a former adviser to the Russian Central Bank, said the withdrawals illustrated a level of fear among the Russian public.
“It means people have no trust in the Russian banking system or in the Russian financial system,” Prokopenko said.
“This is all a consequence of the fear that the government will do something with the banking system, that it could nationalise deposits.”
Russian ex-officials say bank withdrawals show lack of trust in system
Widespread bank withdrawals in Russia are causing liquidity problems, according to a former senior Russian finance official who spoke to the Washington Post.
“Drones are flying. Things are burning down. Nervousness is growing. And people’s everyday wisdom may be kicking in that they need to have cash under their pillow and not somewhere in banks where it may never be returned,” said a former finance official.
“For some banks this really is a problem,” the former official added.
“They didn’t expect this, and they invested all the cash elsewhere, and yet people are coming and taking out half a trillion rubles a month.”
Alexandra Prokopenko, a former adviser to the Russian Central Bank, said the withdrawals illustrated that the Russian public are scared.
“It means people have no trust in the Russian banking system or in the Russian financial system,” Prokopenko said.
“This is all a consequence of the fear that the government will do something with the banking system, that it could nationalise deposits.”
Watch: Ousted Ukraine defence minister calls for presidential election during war
EU welcomes decision by eight countries to back restrictive measures against Belarus
The European Union has welcomed the decision by Albania, Bosnia, Iceland, Liechtenstein, Montenegro, North Macedonia, Norway and Ukraine to align with its restrictive measures against Belarus, EU foreign policy chief Kaja Kallas said in a statement on Tuesday.
In July, the EU Council decided to impose restrictive measures against the country "in view of the involvement of Belarus in the Russian aggression against Ukraine".
Russia's Lavrov says Britain risks being seen as party to Ukraine war
Russian foreign minister Sergei Lavrov said Russia had the right to regard the direct involvement of Britain in strikes on Russian territory as participation in the war in Ukraine.
His comments came after the Times newspaper reported on Saturday that British-made drones had been used for long-range strikes against Russia for the first time.
Following the report, Russia's embassy in London warned Britain of unspecified "consequences" for supplying drones to Kyiv.
PM Andy Burnham said on Tuesday that Britain would support Ukraine "100%" in its fight against Russia and stand by Kyiv "in its hour of need".
Moscow has previously accused British specialists of involvement in attacks on Russian territory, saying Britain's role would be taken "into account" in its response.
Ukrainian power plant hit in Russian attack
A thermal power plant in central Ukraine halted operations yesterday after it suffered significant damage from a Russian strike, power firm DTEK said.
The company declined to name the plant involved.
It said in a statement on Telegram that its thermal plants have been attacked more than 230 times by Russia since the start of the full-scale invasion in 2022.
Estonia PM says arson attack on defence contractor may be linked to Russia
Estonia is investigating whether Russia was involved in an arson attack last week on a building housing a defence contractor, the Baltic country's prime minister said in a statement.
The building used by Milrem Robotics, a maker of unmanned military weapons systems deployed in Ukraine and elsewhere, was targeted late on Friday, a prosecutor earlier told public broadcaster ERR.
"The suspects have been identified. One of the lines of investigation is a possible act of sabotage and the involvement of Russia," Estonian prime minister Kristen Michal said on X.
Moscow has regularly denied accusations of planning or carrying out sabotage and other attacks on countries outside Ukraine, saying such reports are part of an anti-Russian propaganda campaign.
European countries bordering or near Russia are concerned that the war in Ukraine is spilling over into Nato's northern borders.
Ukraine's ousted defence minister challenges Zelensky and calls for wartime elections
Ukraine’s former defence minister Mykhailo Fedorov has called for wartime elections in a bombshell address, arguing the nation faced a crisis of governance, in the biggest internal challenge yet to president Volodymyr Zelensky.
Fedorov issued his call for elections in a video address posted on YouTube, the first such demand by a major Ukrainian political figure since Russia launched its full-scale invasion in 2022.
In what appeared to be an open challenge to Zelensky, Fedorov said Ukraine faced a "systemic crisis of governance”.
“The old system lives by its own rules too often. It protects itself. It is scared of change,” he said.
“Democracy cannot be held hostage by Russia,” Fedorov said.
“We must find a legal, safe and realistic mechanism that will allow Ukraine to renew its full democratic process even in the conditions of a long war.”
While Fedorov did not say in his address that he would compete in any election, a recent poll indicated the ex-minister would comfortably beat Zelensky in a runoff vote, where the top two presidential candidates go head-to-head.
Comment: Putin is an open threat to the UK – will his admirer Nigel Farage finally say so?
Vladimir Putin is displeased. British drones have been used by Ukraine to strike deep into Russian territory. The Russian embassy has warned that “London’s actions will inevitably carry consequences for which it will have to answer”.
It said: “The deeper its involvement in the conflict, and the greater its support for Kyiv’s terrorist machinery, the higher the price it will pay.”
Andy Burnham has responded robustly. He said today: “We support Ukraine 100 per cent against this illegal war led by Vladimir Putin. We are providing support so that Ukraine can defend itself, and that’s been the British position all the way through this conflict.”
But what would Nigel Farage’s response have been, if he had been prime minister?
Read more:
Recap: Burnham says he backs Ukraine 100% after Moscow’s threat over use of UK drones
Andy Burnham has said the UK is continuing to “support Ukraine 100%” after Moscow threatened consequences for the reported use of British drones for strikes deep into Russia.
Russia accused the UK of deliberately escalating the conflict and said the deeper the country’s involvement became, “the higher the price it will pay”.
During a visit to Wolverhampton bus station, Mr Burnham was asked what his message to Russian president Vladimir Putin was in response.
He said: “This is the UK doing what it has long said it would do, which is to support Ukraine 100 per cent against this illegal war led by Vladimir Putin.
“We are providing support so that Ukraine can defend itself, and that’s been the British position all the way through this conflict by previous prime ministers. It remains the case with me.
“We are not fair-weather friends. We will be there in Ukraine’s hour of need, and that won’t change.”
Ukraine used drones made by two UK companies as part of a so-called deep strike campaign, The Sunday Times reported.
Kyiv has stepped up its attacks on Russia this year, with long-range missiles and swarms of drones increasingly targeting military industries and energy facilities.
It has also targeted giant depots for Wildberries – Russia’s largest online retailer – burning billions of pounds of merchandise and bringing the war home to the Russian public more than four years into Moscow’s full-scale invasion of Ukraine.
Russia’s embassy to the UK said in a statement on Monday that the reports “confirm that London is deliberately opting for an escalation of the Ukraine crisis” and accused Britain of “seeking to contain Russia and inflict maximum damage on it by proxy”.
“London’s actions will inevitably carry consequences for which it will have to answer,” it added.
“The deeper its involvement in the conflict and the greater its support for Kyiv’s terrorist machinery, the higher the price it will pay.”
A Ministry of Defence spokesperson said: “Britain stands shoulder to shoulder with Ukraine and we are committed to providing the equipment Ukraine needs to defend itself against Putin’s illegal invasion.
“Russia should be in no doubt about the resolve of this Government to stand against Russian aggression, in Ukraine and against the UK and our allies.”