By Sinead Cruise and Carolina Mandl
(Reuters) -Citigroup has started to allow holders of depositary receipts in Russian companies to cancel them, two sources familiar with the matter said on Thursday.
Citi’s move follows steps taken by banks such as BNY Mellon and JPMorgan & Chase in the last two weeks.
After cancelling a depositary receipt, which are certificates issued by a bank representing shares in a foreign company traded on a local stock exchange, clients receive the underlying share in the Russian company.
This is the first step investors must take to liquidate their frozen holdings. The London Stock Exchange (LSE) halted trading in the depositary receipts of Russian companies roughly a month ago after prices plunged due to a slew of Western sanctions slapped on Russia for its invasion of Ukraine.
Still, due to sanctions imposed by Russia, foreign investors are not allowed to sell their shares.
On Wednesday, Russia’s lower house of parliament has passed a bill on delisting depositary receipts in Russian companies traded on foreign bourses.
(Reporting by Sinead Cruise and Carolina Mandl, Editing by Franklin Paul and Chizu Nomiyama)