EU Targets State-Owned Russia Banks in Sanctions Draft

BRUSSELS (Reuters) – The European Union would target state-owned Russian banks and their ability to finance Moscow’s faltering economy in its most serious sanctions so far over the Ukraine crisis under proposals considered by EU governments on Thursday, diplomats said.

Ambassadors of the 28-nation bloc met in Brussels to discuss options drafted by the executive European Commission in response to the downing of a Malaysian airliner in an area of eastern Ukraine held by Russian-backed separatists.

In the key measure, European investors would be banned from buying new debt or shares of banks owned 50 percent or more by the state. These banks raised almost half of their 15.8 billion euro ($21.29 billion) capital needs in EU markets last year.

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