Sedan The Central Bank of Ukraine puts pressure on Western banks to Russia support in the war effort: “When he stayed in Russia, he decided to support the attacker and his war crimes”, the National Bank of Kyiv (NBU) accuses Western financial institutions and insurance companies that continue to operate in Russia in a release. . “In addition to moral aspects, such a policy contradicts the official position of the governments of the countries of the democratic world and the great support of the Ukrainian people by the population of these countries.”

The background is not only ongoing business operations and what the NBU believes are “bloody” profits by financial institutions from their activities in Russia, but also the support of Russian soldiers – Russians who fought in the war in the Ukraine fight receive special conditions from banks active in the country. This allows them to defer interest payments and repayments during the war.

At the same time, Western banks operating in Russia use the terms “Donetsk People’s Republic” and “Luhansk People’s Republic”, the Russian names for the territories annexed under international law in the Ukrainian Donbass. The war is referred to as a “special military operation” on websites. This is the prescribed terminology in Russia.

From Ukraine’s point of view, they are clearly violating Western sanctions. 45 financial institutions and insurance companies from countries that Russia itself classifies as “hostile countries” still operate subsidiaries or businesses in the vast empire. The NBU has now called on the governments and regulators of these countries to take action on their banks.

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In talks with Western institutions, the NBU repeatedly urged a withdrawal from Russia, as banking and credit transactions in Russia are an important pillar of the local economy and political system. There was no progress. “This is unacceptable almost a year after the start of the war,” an NBU spokesman said.

>> Read here: Why German companies can’t just pull out of Russia

The largest Western institutes still represented in Russia are, after the withdrawal of the French General Societythe Vienna Raiffeisenbank International (RBI), the Italian Intesa Sanpaolothe dutch INGthe French Agricultural Credit and the Hungarian OTP Bank.

The ruble rolled

474

millions of euros

earned the Wiener Raiffeisenbank International (RBI) in the year before the war in Russia almost 30 percent of the total after-tax profit.

town it has already sold the loan portfolio to another bank. The British HSBC he has sold his daughter to the Russian Expobank and is waiting for the deal to go through. Société Générale sold its Russian subsidiary Rosbank to Vladimir Potanin, the founder and previous owner, who served as head from 2006 to 2011. The bank had to write off 3.3 billion euros for this.

Almost a year after the outbreak of the war, most other institutes remain cautious. “It takes time, a bank is not a sausage stand that can be closed in a week,” RBI chief Johann Strobl said in late March 2022.

Especially the Viennese Raiffeisen under pressure

Russia is a particularly important market for RBI: In the year before the war, the business there brought in 474 million euros, almost 30 percent of the profit after taxes. With a profit of €122 million, Ukraine’s activities were also well above the country’s share of RBI’s overall business.

Bank chief Strobl and his board colleague Andreas Gschwenter have one seat and one vote on the supervisory board of Russian subsidiary RBI, while Strobl heads the supervisory body. Therefore, both are on a Ukrainian sanctions list. The RBI pointed to recent allegations of support for Russian soldiers. Twitter back with the information that the bank acts “in accordance with the laws of the country in which it is located.”

Credit Agricole said it had scaled back its lending business in Ukraine. ING wants to have reduced its Russia risk by 2.9 billion euros or 43 percent to 3.8 billion euros by the end of September. prosecution Like most other Western institutes, it refers to a decree by President Vladimir Putin: In August it prohibited sales by foreign banks until the end of 2022. It is currently unclear whether this decree will continue to apply.

With few exceptions, the Western institutes had taken their time. “We don’t want to just give away our shares to Russia or to businessmen close to Putin,” a bank manager working in Russia told the Handelsblatt.

In the end they will leave Russia. Because the risk is too great that the United States classifies Russia as a terrorist state. Michael Zhernov, managing partner of the investment company Millstone

“But in the end they will leave Russia,” Michael Zhernov, managing partner of the investment company Millstone, is convinced. “Because the risk of the United States classifying Russia as a terrorist state is too great,” and Washington severely punishes dealings with terrorists.

the german bank So far, employees have only accused them of failing to shut down their technology centers in Moscow and St. Petersburg, an IT expert from the Frankfurt Institute told the Handelsblatt. Therefore, the Russians remain part of the bank’s global network of programmers. With this degree of interconnection and the increasing activities of the Russian national secret service FSB in foreign companies in Russia, there is considerable security risk.

Anger is prevalent in Ukraine, especially among Raiffeisen and OTP employees. As Russia invades their country and Russian business damages brands’ image, institute employees in Ukraine help the country’s military. 150 Raiffeisen employees are soldiers in the war and are still paid by the bank. RBI’s Ukrainian affiliate also handed over 77 armored vehicles, mostly money carriers, to the army, half of the armored vehicle fleet.

More: Scandalous luxury, corruption: this is how Putin’s military elite lives

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