China’s Heihe Rural Commercial Bank has suspended payments from Russia after being hit with European Union sanctions, Russian media outlet Vedomosti reported. The move underscores Moscow’s growing financial isolation, even as it leans heavily on Beijing for trade.
Heihe, a small lender in northeast China, had been one of the last banks still processing transactions for Russian businesses after larger Chinese banks cut ties under Western pressure. Many Russian small and medium-sized firms had shifted to Heihe following earlier restrictions.
The EU sanctioned the bank on July 18, citing its role in providing cryptoasset services that allegedly helped Russia evade sanctions. While the measures took effect on August 9, importers said payments only stopped last week.
The halt comes despite China’s insistence on neutrality in the Ukraine war. Beijing continues to supply Russia with dual-use technology and purchase Russian oil, helping prop up Moscow’s economy. U.S. President Donald Trump has threatened secondary tariffs, but Beijing has defended its energy purchases as serving “national interests.”
The suspension was reported just as President Vladimir Putin met Chinese President Xi Jinping at the Shanghai Cooperation Organization summit in Tianjin. The talks highlighted Russia’s deepening dependence on China as Western sanctions bite harder.
Kirill Dmitriev, head of the Russian Direct Investment Fund, said new joint projects with China would be announced “in the coming days,” signaling Moscow’s intent to broaden economic cooperation despite financial hurdles.
Outlook
Heihe’s suspension further narrows Russia’s financial options, showing how EU measures are reaching even smaller institutions. While China remains a critical partner, tightening restrictions may test the limits of Beijing’s support as Moscow struggles to keep trade channels open.
