On October 6, 2014, the Treasury Department’s Office of Foreign Assets Control (OFAC) issued General License No. 3, excepting DenizBank AS, a Turkish lender, from the restrictions on access to new debt or new equity under Directive 1 of the Russian Sectoral Sanctions Identifications list. This allows DenizBank to continue accessing U.S. debt and capital markets, despite its ownership by designated Russian entity, Sberbank.

It is unclear whether this was an isolated exception issued because of DenizBank’s status in Turkey and close ties to the European banking system, or if OFAC intends to extend General License No. 3 to other subsidiaries of Directive 1 designated entities.

For a summary of prior Russian sanctions issued by the United States and the European Union, click here.

Client Alert 2014-262