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SBI, PNB ask US Treasury to send advisories via Finance Ministry


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Indian banks have suggested to the US Treasury that its advisories to them should be routed via the finance ministry to ensure speedy implementation. Executives from some of the top lenders, including State Bank of India, Punjab National Bank, and Canara Bank, met with a six-member US Treasury delegation last month.

The discussions focused on Russian payments and a possible breach of the internationally imposed $60 a barrel purchase price on Russian crude. Currently, the US authorities directly issue advisories to banks that use the international financial messaging system SWIFT to transfer funds across borders. The Indian banks have requested that the finance ministry be involved in these advisories to facilitate and provide clarifications, as these issues can be sensitive and may involve penal charges or other violations.

The round table between Indian banks and US Treasury officials was organized following a request from the external affairs ministry. One of the major concerns discussed was the possible evasion of the Russian oil price cap. The Indian banks informed the US Treasury officials that all Indian banks are adhering to guidelines issued by the Reserve Bank of India, and all such transactions are monitored by relevant authorities.

Under existing sanctions, G7 countries and their allies have banned tanker operators, insurers, and other service firms from facilitating seaborne Russian crude exports if the price is over $60/barrel. The US Treasury is continuing to focus on strategies that make it more complicated for Russia to avoid the price cap regime.

In summary, Indian banks have suggested routing US Treasury advisories via the finance ministry to ensure speedy implementation. The discussions between Indian banks and US Treasury officials focused on Russian payments and the possible breach of the $60 a barrel purchase price on Russian crude. The Indian banks assured the US Treasury officials that they are adhering to guidelines issued by the Reserve Bank of India, and all transactions are monitored by relevant authorities.

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