Western Banks Brace For $10 Billion Hit Over Russia Exit
Western banks are bracing for a $10 billion collective hit as they prepare to shutter operations in Russia over the invasion of Ukraine - a move which mirrors several US lenders last month.
Bloomberg News
According to the Financial Times, international sanctions have "forced banks to consider turning their backs on a country that some lenders first entered more than a century ago."
This week a string of European banks set aside billions of euros in provisions ahead of the closure of their Russian operations, following similar moves by US lenders last month. Western banks collectively have $86bn of exposure to Russia — with close to 40,000 staff — and are setting aside more than $10bn in expectation of losses on their ventures, according to Financial Times calculations. -FT
French lender Société Générale, which has operated in Russia for 150 years, has set aside €561mn for the first quarter, and expects to lose €3.1bn ($3.3bn) on the sale of its Rosbank subsidiary - which was founded by billionaire Vladimir Potanin. The bank has 3.1 million retail customers throughout Russia and €18bn ($19.3bn) of total exposure to the country. Around 12,000 people are employed by Rosbank.
Italy's UniCredit has set aside €1.3bn ($1.37bn), and says that exiting Russia entirely could cost it €5.3bn ($5.6bn). The bank currently has 4,000 workers and 2 million customers in the country, where it has operated for 17 years.
"I’m sure you have noticed the speed of change in terms of . . . waves of sanctions," said CEO Andrea Orcel.
Other European banks preparing to take a hit are French bank Crédit Agricole, Austria's Raiffeisen, Swiss lender UBS, and Credit Suisse.
https://ift.tt/dDaoxNp
from ZeroHedge News https://ift.tt/dDaoxNp
via IFTTT
0 comments
Post a Comment