US-sanctioned Kyrgyzstani bank to suspend issuance of Visa cards

Kyrgyzstan’s US-sanctioned Keremet Bank has stopped issuing Visa cards, though existing ones remain usable at its ATMs. The bank, accused of aiding Russian sanctions evasion, plans to appeal the US Treasury’s decision.

Kyrgyzstan’s Keremet Bank, which was hit with US sanctions earlier this month, has discontinued issuing payment cards supported by the international Visa system. However, already issued cards remain functional at the bank’s offices and ATMs.

"Due to restrictions imposed by the Visa international payment system, cards issued by Keremet Bank can only be used on devices (POS terminals, payment terminals, ATMs) owned by OJSC Keremet Bank," the bank’s press service stated.

The US Department of the Treasury’s Office of Foreign Assets Control (OFAC) previously included Keremet Bank on its sanctions list. The Treasury Department stated that the bank’s officials had coordinated their actions with Russian authorities and the sanctioned Promsvyazbank to implement a sanctions evasion scheme since at least the summer of 2024.

According to Keremet Bank’s financial position report for last year, it held approximately $12 million in accounts with other banks. It was not specified how much of this was in local banks and how much in foreign institutions.

The Russian Promsvyazbank has been under sanctions for two years due to its involvement in Russia’s war against Ukraine. According to the US Treasury, it provided financial support to enterprises within Russia’s military-industrial complex.

The US sanctions against Keremet Bank have had no impact on the stability of the country’s domestic foreign exchange market, according to the National Bank of Kyrgyzstan. If necessary, the National Bank is prepared to deploy additional measures and tools to maintain the resilience and stability of the banking system and protect the interests of depositors and creditors.

Keremet Bank has stated that it intends to appeal to OFAC to challenge the allegations of sanctions violations.

Keremet Bank is not merely a private commercial bank. Until a few months ago, it was fully owned by the Kyrgyz government. However, last autumn, it was revealed that 75% of the bank’s shares had been acquired by Luxembourg-based Altair Holding.

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