Raiffeisen Bank International is preparing to spin-off its division in Russia
Raiffeisen Bank International is preparing to spin-off its division in Russia
Photo: Raiffeisen Bank
Austrian-based banking group Raiffeisen Bank International (RBI) had not found a buyer for the bank in Russia and began to prepare for its separation.
This was reported by Reuters, citing its own sources.
If the decision to separate Raiffeisenbank Russia is indeed made, RBI shareholders will receive an additional block of shares: one for RBI without Russia, the second for Russian business. Austria hopes that such a step will relieve reputational pressure from RBI.
Raiffeisen is now the most important Western bank in Russia, offering a payments lifeline to Russians with few alternatives as Moscow is increasingly isolated over its invasion of Ukraine.
A spokesperson said Raiffeisen would "continue to progress potential transactions which would result in the sale or spin-off of Raiffeisenbank Russia".
While a spin-off has wide support among Austrian authorities, it faces hurdles, including securing European Central Bank (ECB) approval, as well as Washington, which is concerned about how the new organization will control money laundering and is probing RBI's Russia links.
If the spin-off proceeds, it could make RBI's owners, led by Austrian community banks, shareholders in a new entity listed in the Vienna Stock Exchange.
It remains unclear whether the entity would be truly independent of RBI, a decisive factor for whether it should be supervised by Austria or the ECB.
One of the sources said that the spin-off was seen as better than a sale, while a second familiar with ECB thinking said that the degree to which the spun-off bank was independent of RBI would determine whether the central bank would oversee it.
Recall that the National Agency on Corruption Prevention included Austrian-based banking group Raiffeisen Bank International in the list of international sponsors of the war.
During Austrian President Alexander Van der Bellen's visit to Kyiv, Ukrainian President Volodymyr Zelenskyy criticised Austrian businesses still operating in Russia, singling out Raiffeisen. The bank has also been sharply criticised by investors after participating in a Russian scheme to grant loan payment holidays to troops fighting in Ukraine.
In addition, the Head of the NBU Andrii Pyshnyi urged Raiffeisen Bank not to delay the decision to spin-off from Russia.