‘Facing abnormal cash outflows’: Russia’s largest lender Sberbank quits European market
Sberbank, Russia’s largest lender, announced its exit from the European market on Wednesday, citing pressure from Western sanctions imposed in response to Moscow’s invasion of Ukraine.
“Sberbank has decided to withdraw from the European market in the current environment,” the lender said in a statement carried by Russian news agencies. According to the statement, the bank’s European subsidiaries were experiencing “abnormal cash outflows and threats to the safety of employees and branches.”
According to the statement, the bank’s European subsidiaries were experiencing “abnormal cash outflows and threats to the safety of employees and branches.”
Following the announcement of tough European Union sanctions aimed at limiting Russian banks’ access to capital markets, Sberbank experienced financing difficulties. Since Russian troops entered Ukraine last week to carry out Vladimir Putin’s mission of destabilising President Volodymyr Zelensky’s pro-Western government, hundreds of civilians, including children, have been reported killed.
European banking regulators announced Tuesday that Russia’s Sberbank’s European subsidiary would be closed. Sberbank Europe AG, based in Austria, will be allowed to enter “normal insolvency proceedings,” while branches in Croatia and Slovenia will be sold to local banks, according to the European Banking Supervisory Authority.
Sberbank Europe AG, based in Austria, will be allowed to enter “normal insolvency proceedings,” while branches in Croatia and Slovenia will be sold to local banks, according to the European Banking Supervisory Authority.
The European Central Bank declared on Monday that the European affiliate was “failing or likely to fail” due to “significant deposit outflows as a result of the reputational impact of geopolitical tensions.”
