Russia's VTB Prepares for Europe Exit Following Sanctions

VTB Bank is reportedly preparing a withdrawal from Europe following Russia's invasion of Ukraine and retaliatory sanctions.

This decision comes after assets of the Russian lender were frozen by western allies in light of the conflict, reportedly.

This comes on the heels of European regulators' decision to wind down and divest Sberbank's European units amid the Ukraine conflict.

VTB, the second-biggest bank in Russia, will soon be removed from the Swift global payments system as well.

This ends Russian lenders' long-running strategy to expand its global reach. However, Russia's Crimea annexation in 2014 and retaliatory sanctions impacted this plan significantly. 

VTB's retail banking unit in Germany has a customer base of 160,000. It manages over €4bn in deposits for mainly German retail clients. The bank also has 600 firms, 150 financial institutions, and German local governments in its client list.

Retail customers reportedly opted for VTB as it did not charge negative interest rates.

Last month, VTB Capital's London Stock Exchange membership was ended, and the UK government froze the bank's assets.

The bank has now been offered a 30-day licence, ending 27 March, to make payments to its employees as well as close transactions. Upon expiry of the licence, jobs of its UK employees will be axed.

(Source: Retail Banker International)