The European Bank for Reconstruction and Development said on Wednesday that it will not give approval to new investment projects in Russia after the European Union and the US slapped sanctions on the country last week as the Russia-Ukraine conflict worsened.

"A majority of the Board of Directors of the European Bank for Reconstruction and Development (EBRD), including all EU member states and several non-EU shareholders, have given clear guidance to the EBRD management that, for the time being, they will be unable to approve new investment projects in the Russian Federation," the lender said in a statement.

"Their guidance follows a declaration by last week's European Council which called on the EU member states to coordinate their positions within the Bank's Board. The EBRD management will be guided by this in its operational approach in Russia."

The EBRD Board of Directors represents the Bank's shareholders which include 64 member states, as well as the European Union and the European Investment Bank.

The latest move does not affect the existing projects and clients in Russia and the bank's physical presence will be maintained in the country, the bank said.

During the first half of the year, 19 percent of EBRD's investments went to Russia and 81 percent were made in other 34 countries. The total EBRD investments were a record EUR 3.6 billion during the period.

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