Law360 (February 24, 2022, 4:00 PM EST) -- President Joe Biden on Thursday announced additional sanctions and new export controls on Russia for its "premeditated attack" on Ukraine, including sanctions on its largest banks and extensive restrictions on exports of semiconductors and other high-tech equipment.

Thursday's sanctions are aimed at major Russian financial institutions that account for nearly 80% of all banking assets in that country, according to the U.S. Department of the Treasury, adding to Tuesday's sanctions against state-owned financial institutions Vnesheconombank and Promsvyazbank.

Transactions will be barred with Russia's two largest banks, Sberbank and VTB Bank and their subsidiaries, which together hold more than half of total banking assets in Russia. Russian institutions process about $46 billion in foreign exchange transactions each day, 80% of that in U.S. dollars, and the banks targeted with sanctions will no longer be able to benefit from the U.S. financial system, Treasury said.

Biden announced the penalties after Russia launched what the president said was an unprovoked "brutal assault" on Ukraine and rebuffing "good faith" international efforts to address Russia's purported security fears of a Ukraine attack.

"[Russian President Vladimir] Putin chose this war and now he and his country will bear the consequences," Biden said at the White House on Thursday. "We have purposely designed these sanctions to maximize the impact on Russia and minimize the impact on the U.S. and its allies."

The administration will also expand sanctions on "corrupt billionaires" and other Russian elites deemed close to Putin. These sanctions were first announced Tuesday, targeting people who "personally gain from the Kremlin's policies and … should share in the pain," Biden said.

The list of elites includes several Putin allies and their children, including various politicians, Rosneft CEO Igor Sechin, and executives at Sherbank and VTB Bank, according to Treasury.

Putin had argued in a televised address Monday that moving into Ukraine was necessary to protect civilians in Ukraine's separatist Donetsk and Luhansk People's Republics from Ukrainian aggression — an argument U.S. officials said was pretextual — and protect Russia's security, after the U.S. and its allies had ignored Russian demands to bar Ukraine from joining NATO.

Ukrainian officials said Thursday that Russia's invasion was an attempt to "destroy" the country, a former Soviet state, as it tries to move away from Russia's influence.

The sanctions also broadly target Russian banks Otkritie, Novikombank and Sovcombank, and impose strict limitations on debt and equity transactions with other major Russian entities, including its third- and fifth-largest banks Gazprombank and Russian Agricultural Bank and large shipping, energy, mining and telecommunications companies. The penalties would cut off these entities' ability to raise capital through U.S. markets. 

Several major Belarusian banks and defense companies are also being sanctioned after Belarus, which the administration said had "become increasingly subservient to Russia," allowed Russia to use it as a staging ground for the Ukraine invasion.

In an effort to squeeze Russia's defense, aerospace and maritime industries, the U.S. Department of Commerce also announced what it said were the most comprehensive export controls ever imposed on a single country.

These include restrictions on the export of sensitive technologies such as semiconductors and microelectronics, computers and information security products, telecommunications equipment, various aircraft and marine components, and lasers and sensors, aimed at 49 Russian military entities, Commerce said.

Russia can expect similar export controls and sanctions from the European Union, Australia, Canada, Japan, New Zealand and the United Kingdom, Biden said. These measures will limit Russia's ability to do business not only in dollars, but also Euros, British pounds and yen.

But there are no direct sanctions on Putin or Russia's energy sector beyond Wednesday's sanctions on the $11 billion Nord Stream 2 pipeline, amid concerns about a potential increase in gasoline prices, according to the president.

The sanctions also won't cut off Russia's access to SWIFT, the intermediary system used for international banking transactions, as the EU did not want to take that step, Biden said. But the sanctions imposed on Russia's banks will be of "equal, if not more, consequence" than blocking access to SWIFT, he said.

A representative for Russia's Embassy in the U.S. did not immediately respond to a request for comment on Thursday.

--Additional reporting by Grace Dixon. Editing by Orlando Lorenzo.

Correction: A previous version of this article mistakenly stated the amount of foreign exchange transactions that are processed by Sberbank and VTB Bank. The error has been corrected.

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