The latest wave of sanctions against Russia for its invasion of Ukraine has brought new restrictions on the global banking sector.
Some Russian banks will be excluded from Swift’s international payments system, and other major sanctions have been imposed on Russia’s central bank to prevent it from using its foreign exchange reserves.
The move seeks to undermine Russia’s ability to survive broader economic sanctions imposed on the country, but it also affects Western banks that have exposure to the Russian economy.
The European division of Sberbank, Russia’s biggest bank, is in danger of bankruptcy, the European Central Bank (ECB) announced after a run by depositors caused by the crisis.
In Europe, French and Italian banks have the largest exposure to Russia, worth just over US$25 billion (R$128.5 billion) for each country at the end of September; just below are the Austrian banks, with US$ 17.5 billion (R$ 89.9 billion), according to the Bank for International Settlements (BIS).
The exposure of American banks is in the order of US$ 14.7 billion (R$ 75.5 billion).
Below is a list of banks with significant exposure to Russia.
citi
The American bank announced on Monday (28) that its total exposure to Russia was almost US$ 10 billion (R$ 51.4 billion).
Citigroup said that of the 25 countries to which the institution has the most exposure, Russia ranked 21st at the end of 2021, with $5.4 billion in loans, bonds and commitments. of funding —0.3% of the bank’s total exposure, based on documents submitted by the bank to regulatory authorities.
On Monday, Citigroup offered new details, bringing its “total third-party exposure” to $8.2 billion in the Russian case. This includes US$1 billion (R$5.1 billion) in deposits with the Bank of Russia and other financial institutions and US$1.8 billion (R$9.2 billion) in reverse repurchase agreements.
Citigroup also said it had US$1.6 billion (R$8.2 billion) in additional exposure to Russian counterparties outside its Russian subsidiary, and this amount is not included in the total of US$8.2 billion (R$8.2 billion). $42.1 billion).
Raiffeisen Bank International (RBI)
Russia ranks ninth among RBI loan destinations. With total assets of US$15.8 billion euros (R$82 billion), the bank employs 8,700 people and serves more than 4.5 million customers.
Its share capital of €2.4 billion (R$13.8 billion) represents 18% of its consolidated assets.
RBI has been operating in Russia since the collapse of the Soviet Union, and its business there contributed nearly a third of the 1.5 billion euros (R$8.6 billion) net profit the group posted last year.
RBI’s total exposure to Russia is €22.85 billion, and more than half of the total relates to the private business sector, the bank said in its 2021 earnings presentation.
The Russian central bank accounts for 8% of RBI’s exposure to the country, sovereign entities for 4% and Russian banks for 2%, according to the presentation.
The total number comprises 11.6 billion euros (R$67 billion) in consumer loans (or 11.5% of the group’s total), over 80% of which are denominated in rubles.
Transnational exposure to Russia is just €1.6 billion (R$9.2 billion), and there is no direct involvement from the head office in Vienna. Raiffeisen also holds 2.2 billion euros (R$12.7 billion) in loans to Ukrainian customers.
Reserves against losses cover 64.3% of RBI’s exposure to Russia.
Johann Strobl, the bank’s chief executive, told Reuters this week that the group’s Russian subsidiary “had a very strong liquidity position and was seeing cash inflows.”
Société Générale
Société Générale began operating in Russia in 1872, left the country in 1917 due to the Bolshevik revolution, and returned in 1973. The bank has 1.5 million customers in the country.
Société Générale, which controls Russian bank Rosbank, had 18 billion euros of overall exposure to Russia at the end of last year, or 17% of the group’s total.
This includes both on-balance sheet and off-balance items (for example, an unused credit line).
Of Société Générale’s exposure to Russia, 39% is to the business sector and 36% to retail. Sovereign entities account for 21% and financial institutions for 4%.
The total volume of loans grew by 13.3% last year, to 10.5 billion euros (R$ 60.6 billion).
The bank’s retail business in Russia — to which 10.5 billion euros of capital was allocated on average last year — produced 115 million euros (R$664.4 million) in net income in 2021, up from 37 million euros. million euros (R$ 213.8 million) in 2020.
The bank announced that it had implemented measures to adapt to the new sanctions, and that Rosbank continued to operate “in a safe manner”.
UniCredit
The Italian bank’s Russian subsidiary is the 14th largest bank in the country. The 2.3 billion euros (R$ 13.3 billion) in capital of UniCredit Russia represent 3.7% of the group’s total.
UniCredit’s exposure in the event of a total Russian default was 14.2 billion euros (R$ 82 billion), in the middle of 2021.
Of that amount, around eight billion euros were loans granted by the bank’s Russian subsidiary and capitalized locally.
The remainder includes off-balance sheet items and cross-border loans, mainly granted by Italian UniCredit to large companies outside Russia.
UniCredit announced last week that its Russian operations accounted for only about 3% of the group’s revenue, and that it had reserves worth 84% of its exposure.
Intesa Sanpaolo
Italy’s biggest bank has financed major investment projects in Russia, such as the Blue Stream pipeline and the sale of a stake in state-owned oil company Rosneft.
Intesa’s exposure to loans to Russia was €5.57 billion (R$32.2 billion) at the end of 2021, or 1.1% of the bank’s total.
Intesa’s subsidiaries in Russia and Ukraine have assets of, respectively, 1 billion euros (BRL 5.7 billion) and 300 million euros (BRL 1.7 billion), which is equivalent to only 0.1% of the group’s total assets.
Intesa, the biggest Italian bank, handles more than half of the commercial transactions between Italy and Russia.
ING
The Dutch bank has around 4.5 billion euros (BRL 26 billion) in loans open to Russian customers, and around 600 million euros (BRL 3.4 billion) in loans to customers in Ukraine, from a portfolio total loans of more than 600 billion euros (R$ 3.4 trillion).
ING reported that there were many sanctions in place against Russia since 2014.
Translation by Paulo Migliacci
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