Even a Russian-cofounded bank can’t fund new projects in the country — and it shows just how financially isolated the country is

Russia’s so cut off from the global financial system that even the New Development Bank, or NDB — a multilateral lender it cofounded —  doesn’t want to start new projects there amid sweeping sanctions against the nation.

“Any speculations concerning the discussion of new operations of the NDB in Russia are unfounded,” the development bank said in a Wednesday statement. 

The Shanghai-headquartered NDB was founded in 2015 by the “BRICS” nations — that’s Brazil, Russia, India, China, and South Africa.

Dilma Rousseff, NDB’s president and a former leader of Brazil, posted a longer statement in Portuguese on Twitter, now known as X. She said the bank is not considering new projects in Russia as it operates in compliance with international financial and capital restrictions.

Rousseff is attending a two-day summit in the Russian city of St. Petersburg that starts Thursday, per NDB’s statement.

On Wednesday, she also met with Russian President Vladimir Putin, the Kremlin said in a statement. Rousseff said on X that she would be discussing “the role of the NDB in the upcoming BRICS Summit” with the Russian leader, according to a Reuters translation.

The distance the NBD is putting between itself and Russia adds to the country’s economic and financial isolation.

Mere days after it invaded Ukraine, some Russian banks were banned from SWIFT, the Belgium-based messaging service that lets banks globally communicate about cross-border transactions. This ban and a corporate exodus involving international banks and accounting giants have hampered cross-border transactions.

And Russia’s now scouting for allies to trade with — including BRICS countries. 

The group is scheduled to meet in South Africa next month. While there were expectations that they would be developing a common currency to rival the US dollar — as Putin indicated last year — India has denied the grouping was working on it.

On Wednesday, Putin did not mention the common currency but told Rousseff that BRICS are boosting their use of local currencies to settle trade, according to the Kremlin’s readout of his meeting with the NBD chief.

Putin also managed to take a swipe at the greenback while congratulating Rousseff on her appointment as the bank’s president in March this year.

“I am confident that, drawing on your vast experience in government work and knowledge in this area, you will make every effort to develop this institution – which I think is essential today,” he said. “In the current conditions, it is not easy to do so, given the developments in global finance and the use of the dollar as a political weapon.”