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Friday, March 1, 2024

Sberbank Russia’s biggest lender, exits Europe

Reacting to numerous world sanctions placed on Russia over its invasion of Ukraine; Sberbank, Russia’s largest lender, has declared its withdrawal from Europe.

“In the current environment, Sberbank has decided to withdraw from the European market,” it announced on Wednesday in a statement carried by Russian news agencies.

Sberbank, which had operations in Austria, Croatia, Germany and Hungary among other nations, had European assets worth 13 billion euros ($14.4bn) as of December 31, 2020.

The state-controlled bank’s European subsidiaries were experiencing “abnormal cash outflows and threats to the safety of employees and branches”, it added.

Following a central bank directive, the bank stated that it was no longer able to deliver liquidity to European subsidiaries, but that its capital level and asset quality were adequate to pay all depositors.

Western nations have taken extraordinary efforts to isolate Russia’s economy and banking system in the aftermath of the invasion, including sanctions on its central bank and the suspension of some of its institutions from the global payments system, SWIFT.

The European Central Bank had previously ordered the closure of Sberbank’s European subsidiary after warning that it threatened collapse due to a run on its deposits caused by the war’s aftermath.

Sberbank’s Austria-based European arm, Sberbank Europe AG, would be allowed to enter “normal insolvency proceedings”, while branches in Croatia and Slovenia were sold to local banks, ECB said.

Slovenian bank NLB said it was acquiring Sberbank’s Slovenian unit.

The exit does not affect the bank’s operations in Switzerland.

The Moscow Exchange has halted trading on stocks and sought to prevent capital outflows from Russian assets, but Sberbank’s depositary receipts in London have lost their entire value, falling to $0.

Chinaza Ogbachalu
Chinaza Ogbachaluhttps://www.chinazaogbachalu.com/
My name is Chinaza Ogbachalu, and I am a writer. I have been writing news and opinion articles for five years plus and have always had a passion for storytelling. I grew up in Nigeria and graduated from the University of Port Harcourt, Nigeria, with a degree in linguistics and communication studies. I have written books that have been well-received by critics and readers alike. My work often focuses on culture and lifestyle, and I draw inspiration from my own experiences and observations of the world around me. As a news writer, I am responsible for researching and writing engaging and accurate news stories for our online audience. I have a strong passion for current events and am skilled at conducting interviews and gathering information from sources. I am grateful for the support of my readers and am constantly humbled by their enthusiasm for my work. Thank you for taking the time to learn more about me and my writing.
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