Russia's central bank has promised to support financial institutions hit by fresh US sanctions. The European Union has also announced measures to limit access to capital for Russian banks.
In an online statement posted Wednesday, Russia's central bank promised to take "adequate measures" to support targeted institutions.
The reaction comes one day after the US announced new sanctions that targeted the Bank of Moscow, the Russian Agricultural Bank and the country's second-largest bank, VTB.
Washington said the new sanctions constrain roughly 30 percent of Russia's banking sector assets.
VTB, in a statement, called the sanctions "politically motivated, unfair, legally dubious and economic damaging for all parties."
"We are confident in our ability to raise new funding when necessary," VTB said.
The move to increase sanctions comes after a Malaysia Airlines passenger plane was shot down over eastern Ukraine killing all 298 people on board. Western officials accuse pro-Russian separatists of bringing down the plane with a surface-to-air missile supplied by Moscow.
"Russia's actions in Ukraine and the sanctions that we've already imposed have made a weak Russian economy even weaker," President Barack Obama said Tuesday.
The International Monetary Fund (IMF) has slashed Russia's growth forecast for this year to nearly zero, down from 1.3 percent last year.
The European Union also announced measures limiting access to capital for Russian banks.
EU President Herman Van Rompuy and the president of the European Commission, Jose Manuel Barroso, said the sanctions sent a "strong warning" that Russia's destabilization of Ukraine could not be tolerated.
Europe, however, has a far stronger economic relationship with Moscow than the US does, and until this week EU leaders had been reluctant to impose harsh penalties for fear of harming their own economies.
"When the violence created spirals out of control and leads to the killing of almost 300 innocent civilians in their flight from the Netherlands to Malaysia, the situation requires urgent and determined response," the two top EU officials said in a statement.
Meanwhile, the Moscow-based Association of European Businesses (AEB) said on Wednesday it "deeply regrets" new sanctions imposed by the EU on Russia.
"Considering the volume of trade between Russia and the EU, and Russia and Ukraine, the AEB expects that these new sanctions will not only hurt the Russian economy, but also will restrict growth in both the EU and Ukraine," it said in a statement.
hc/dr (Reuters, AP)
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