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Russia’s No.1 lender Sberbank pulls out of Europe -Breaking

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© Reuters. One person walks past the logo of Russian Sberbank Europe AG’s bank headquarters in Vienna (Austria), February 28, 2022. REUTERS/Leonhard Foeger

MOSCOW (Reuters), -Russia’s biggest lender, Sberbank, announced Wednesday that it would quit almost all European market. It blamed large cash outflows for its employees and property being threatened by Western sanctions and Russia’s invasion in Ukraine.

This news was made as the bank controlled by the government reported record profits in 2021.

Following a central banking order, the bank stated that it could no longer supply liquidity to European subsidiary banks, however its capital and asset quality were adequate to pay all depositors.

Sberbank said that in the present situation it has made the decision to withdraw from the European Market. The group’s subsidiaries banks faced unusual cash outflows, threats to its safety and the safety of their employees.

Western countries have taken unprecedented measures to isolate Russia’s economy, financial system and finances in response to its invasion Ukraine. They include sanctions on Russia’s central bank and exclusion of certain of its lenders from the global payment system SWIFT.

Sberbank’s European division was already being closed by the European Central Bank, (ECB), after it warned that the bank could fail due to a run-on its deposits sparked in response to the Moscow invasion.

Sberbank had European assets of 13 billion euro ($14.4billion) as of December 31, 2020. It had branches in Austria, Croatia and Germany.

NLB Slovenian Bank announced it is acquiring Sberbank’s Slovenian Unit.

It will not impact the operations of the bank in Switzerland.

Sberbank’s 2021 net profit jumped 64% to 1.25 Trillion roubles ($12.38 Billion) Sberbank’s year-end return on equity was 24.2%. Its net interest income was 1.8 trillion Rupees.

Moscow Exchange suspended stock trading and attempted to stem capital outflows from Russian assets. But Sberbank’s London depositary receipts fell to zero, meaning that their total value has fallen to 0.

($1 = 100.9700 roubles)

($1 = 0.9018 euros)

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