(Bloomberg) —

Shares of European banks with links to Russia suffered the sharpest declines on the region’s exchanges Monday, as Western nations intensified financial sanctions on Moscow following the invasion of Ukraine.

Austria’s Raiffeisen Bank International (VIE:) led the declines with a drop of as much as 18% after the open in Vienna, amid investor concern that the sanctions would hit one of the lender’s most profitable units. France’s Societe Generale (OTC:) SA and Italy’s UniCredit SpA (MI:)  were both down about 10%. Each of these three companies have substantial Russian businesses. 

Read more: Russia increases rates to the highest since 2003; adds capital control

Lenders are waking up to a rapidly shifting scenario after the U.S. and EU ramped up their measures against Russia blocking some of the nations banks from the international SWIFT transaction messaging system and moving to target the central bank’s foreign exchange reserves.  On Monday the ruble fell to the open, prompting an emergency hike in interest rates.

Raiffeisen said it couldn’t yet estimate the financial effect of sanctions as they were being expanded daily, according to a statement Monday. The lender said the measures had a “tough and far-reaching” impact on financial markets and the real economy.

Bloomberg Intelligence reports that the bank holds 11.6 billion euro of Russian loans, which is 11% of its total. It also makes over 30% of its pretax profits there.

“The exclusion of Russian banks from international payments means that these financial institutions can no longer repay their debts to their European creditors,” VP Bank chief economist Thomas Gitzel said. “For the EU as a whole, Russia’s liabilities are manageable. The claims amount to around US$75 billion or 0.7% of the total bank claims.”

At 10:08 in Paris, The Europe banks Index was at 5.9%. 

©2022 Bloomberg L.P.