Russians pull billions of dollars from state banks amid fears of asset seizure

Data from Russia's Central Bank show a growing wave of withdrawals from state-owned banks as citizens worry the government could seize their savings. In the first two weeks of August, almost $3.4 billion was withdrawn, following $7.3 billion in July and more than $4.5 billion in June. The total withdrawn since the start of the year has already surpassed $24.7 billion, exceeding the amount pulled out during the entire first year after Russia's full-scale invasion of Ukraine in 2022.

A former senior Russian financial official told The Washington Post that anxiety has been fueled further by Ukrainian drone strikes reaching deep into Russian territory, with people increasingly deciding it is safer to keep cash at home than in banks they may not be able to access later.

Capital flight extends beyond individuals

Companies are also moving money beyond the reach of Russian regulators — more than $9.4 billion was transferred out of the country in the second quarter of this year alone. The outflows are straining bank liquidity and making it harder for the government to raise funds through bond sales to cover war spending. Russia's economic growth has slowed sharply, expanding just 0.3% in the first half of this year compared with 1.2% a year earlier. The Finance Ministry recently canceled a planned bond issue.

Aleksandra Prokopenko, a former adviser to Russia's Central Bank, said the withdrawals reflect a loss of trust in the banking and financial system. She considers full nationalization of deposits unlikely but does not rule out possible restrictions on withdrawals. Meanwhile, Russian authorities have intensified a campaign of asset seizures targeting wealthy citizens — prosecutors reported $51.5 billion in confiscated assets last year, including a $7.6 billion seizure in June linked to agricultural tycoon Vadim Moshkovich, the largest such confiscation since 2022.