Baird made the admission in the House of Commons after a question from NDP foreign affairs critic Paul Dewar.
"Following receipt of new information and further investigation and analysis, these entities are being removed from the list," Baird said.
Baird said they were "sufficiently divorced" from the events surrounding the Russian aggression in Ukraine.
Earlier this week, Canada announced more sanctions and travel bans aimed at ratcheting up the pressure on Russian President Vladimir Putin.
But the New Democrats wanted to know why Baird made no mention of the fact that the two banks, Expobank and Rosenergobank, were being taken off the list.
"The Conservatives have quietly lifted sanctions on two Russian banks," said Dewar.
"They continue to shield three Russian tycoons who have close ties to President Putin, who have also business interests, right here in Canada. This is the opposite of targeted sanctions."
Baird defended the government's sanctions record, saying Canada has imposed 189 sanctions on Russia — nearly twice as many as the United States and the European Union.
"That's why the president of Ukraine is so thrilled with this government."
Ukrainian President Petro Poroshenko gave an impassioned speech to a joint session of Parliament on Wednesday, extolling the deep links between the two countries.
"It's not just a question of numbers. It's a question of selectivity," charged the NDP's development critic Helene Laverdiere.
"Magnates of the Russian economy who are on the American list but who have financial interests in Canada are not affected by those sanctions. That's so oddly selective."
Baird fired back, relying on the fact that Canada has a much longer list than the United States, which has sanctioned 107 entities, while the European Union has 106.
"Canada is not a world leader — it is the world leader in terms of sanctioning the Putin government in Moscow."