Exclusive-U.S. plans to cut ties with targeted Russian banks if Ukraine is invaded - sources

FILE PHOTO: Logos are on display outside a branch of VTB bank in Moscow, Russia May 30, 2019. REUTERS/Evgenia Novozhenina

WASHINGTON/NEW YORK (Reuters) - President Joe Biden's administration has prepared an initial package of sanctions against Russia that includes barring U.S. financial institutions from processing transactions for major Russian banks, three people familiar with the matter said.

The measures, which would only be implemented if Russia invades Ukraine, aim to hurt the Russian economy by cutting the "correspondent" banking relationships between targeted Russian banks and U.S. banks that enable international payments.