Six billion slumbering

RBI: Russian exit only against “compensation”

The bumpy exit of Raiffeisen Bank International AG (RBI) from Russia continues to drag on. It will not happen without compensation, it is now said - the bank has already accumulated up to six billion euros in equity in the war-torn country.

First the bank did not want to withdraw from Russia despite the war of aggression in Ukraine, then it did, then a possible takeover of the local subsidiary failed and then it was targeted by the US secret services; now the departure could be delayed even further, as reported by the Handelsblatt.

Immediate exit would hurt the bank
"I understand that the decision not to pay a dividend and the negative impact on the Group must be considered, which we are doing," the newspaper quoted the bank's CEO Johann Strobl as saying in a conference call with analysts. However, the bank is "not yet at the point where we can exit without any compensation".

Still the largest Western bank in Russia
Business in Russia continues to be very lucrative for RBI, as it is still the largest Western bank in the country. The Russian subsidiary continues to make substantial profits from quarter to quarter. However, due to the sanctions, these are stuck locally - according to Strobl, this now amounts to five to six billion euros in equity.

In the short term, it is also not foreseeable that funds will flow westwards. According to Strobl, there have been discussions about applying for a distribution, but dividends are still not being paid out to Vienna.

"I assume that the ECB is in agreement with this"
"Nevertheless, the bank is continuing to work on its exit from Russia, as demanded by the European Central Bank ECB. In the third quarter, local customer deposits shrank by 26 percent, Strobl told Handelsblatt. However, it will be years before the entire loan portfolio is phased out.

"It will take some time until we are at zero," Strobl said on this point. However, he assumes that "the ECB currently agrees that we should implement what we have so far."