Explainer-Which international banks are exposed to Russia?

By Valentina Za

MILAN (Reuters) -The newest wave of sanctions on Russia over its Ukraine invasion has thrown the worldwide banking trade deeper into turmoil, as Western nations attempt to squeeze Moscow’s entry to money for its economic system and worldwide commerce.

Some Russian banks will probably be excluded from the SWIFT worldwide funds system and, crucially, different sanctions goal the nation’s central financial institution to cease it from utilizing its international reserves.

The strikes purpose to undermine Moscow’s skill to climate the broader financial sanctions however in addition they influence Western banks that are uncovered to Russia’s economic system.

The European arm of Sberbank, Russia’s greatest lender, faces failure, the European Central Financial institution has mentioned, after a run on its deposits sparked by the disaster.

In Europe, Italian and French banks have the biggest Russian publicity, representing simply over $25 billion every on the finish of September, adopted by Austrian banks with $17.5 billion, information by the Financial institution of Worldwide Settlements https://stats.bis.org/statx/srs/desk/b4?c=RU&f=pdf (BIS) present.

The publicity of U.S. banks totals $14.7 billion, in response to BIS information.

Following are a few of the banks with important Russian publicity.

U.S. BANKS

CITIGROUP INC

The U.S. financial institution on Monday mentioned its complete publicity to Russia amounted to almost $10 billion.

Citigroup listed Russia as 21 amongst its high 25 nation exposures with $5.4 billion of loans, securities and funding commitments at end-2021 – 0.3% of total exposures primarily based on a regulatory submitting.

On Monday, Citigroup gave extra particulars, taking the depend for “complete third-party publicity” to $8.2 billion. That features $1.0 billion in money on the Financial institution of Russia and different monetary establishments and $1.8 billion of reverse repos.

Citigroup additionally mentioned it has $1.6 billion of exposures to further Russian counterparties exterior of its Russian subsidiary that aren’t included in that $8.2 billion.

As a comparability, Goldman Sachs Group Inc reported in a submitting final month $293 million in internet publicity to Russia, in addition to a complete of $414 million of market publicity as of December 2021.

EUROPEAN BANKS

RAIFFEISEN BANK INTERNATIONAL (RBI)

The Austrian lender’s Russian enterprise ranks because the nation’s ninth largest financial institution by loans https://www.rbinternational.com/en/who-we-are/our-network/international-network/raiffeisen-in-russia.html. With total property of 15.8 billion euros, it employs round 8,700 workers to serve greater than 4.5 million clients.

Its fairness of two.4 billion euros file:///C:/Customers/u8018106/OneDrivepercent20-%20Thomsonpercent20Reuterspercent20Incorporated/Paperwork/2022-02-02percent20Presentationpercent20RBIpercent20(3).pdf represents 18% of consolidated fairness.

RBI has operated in Russia for the reason that collapse of the Soviet Union and its enterprise there contributed nearly a 3rd to the group’s internet revenue of 1.5 billion euros ($1.66 billion) final 12 months.

RBI’s Russian publicity totalled 22.85 billion euros file:///C:/Customers/u8018106/OneDrivepercent20-%20Thomsonpercent20Reuterspercent20Incorporated/Paperwork/2022-02-02percent20Presentationpercent20RBIpercent20(2).pdf, greater than half regarding the company non-public sector, it mentioned in its 2021 outcomes presentation.

Russia’s central financial institution accounts for 8% of RBI’s publicity to the nation, sovereign entities for 4% and Russian banks for two%, primarily based on the presentation.

The general determine includes 11.6 billion euros in buyer loans (or 11.5% of group), greater than 80% of that are in Russian roubles.

Cross-border publicity to Russia is just one.6 billion euros with no guardian funding from Vienna. Raiffeisen additionally holds 2.2 billion euros in loans to Ukrainian clients.

Provisions towards losses cowl 64.3% of RBI’s impaired exposures in Russia.

RBI Chief Govt Johann Strobl advised Reuters this week that the group’s Russian subsidiary “had a really sturdy liquidity place and (was) recording inflows.”

SOCIETE GENERALE

Societe Generale began doing enterprise in Russia in 1872 then left the nation in 1917, the 12 months of the Bolshevik revolution, to return in 1973. It has 1.5 million native clients.

Societe Generale, which controls Russian financial institution Rosbank, had 18 billion euros https://www.societegenerale.com/websites/default/information/paperwork/2022-02/This fall-21-Monetary-Outcomes-Presentation.pdf of total publicity to Russia on the finish of final 12 months – or 1.7% of the group complete.

That features each on- and off-balance sheet gadgets (for instance a credit score line that has not but been tapped).

Of SocGen’s Russian publicity, 39% is to the company sector and 36% to retail. Sovereign entities account for 21%, monetary establishments for 4%.

Precise loans grew 13.3% final 12 months to 10.5 billion euros.

Its Russian retail enterprise – to which 1.05 billion euros of capital was allotted on common final 12 months – produced 115 million euros in 2021 internet earnings, up from 37 million euros in 2020. Together with monetary companies, internet earnings at SG Russia was 152 million euros, versus 76 million in 2020.

The financial institution mentioned it had applied measures to adapt to the brand new sanctions and that Rosbank continued to function in a “protected method”.

UNICREDIT

The Italian financial institution’s Russian subsidiary ranks because the nation’s 14th largest financial institution. UniCredit Russia’s 2.3 billion euros in fairness accounts for 3.7% of the group’s complete.

UniCredit’s “publicity at default” regarding Russia totalled 14.2 billion euros as of mid-2021.

Of that, round 8 billion euros are loans prolonged by the Russian arm and domestically funded.

The remainder consists of off-balance sheet gadgets and cross-border loans primarily granted by UniCredit SpA in the direction of massive corporates exterior of Russia.

UniCredit mentioned final week its Russian franchise accounted for less than round 3% of group revenues and provisions coated 84% of its non-performing exposures.

INTESA SANPAOLO

Italy’s greatest financial institution has financed main funding tasks in Russia, such because the Blue Stream fuel pipeline and the sale of a stake in oil producer Rosneft. It handles greater than half of all industrial transactions between Italy and Russia.

Intesa’s mortgage publicity to Russia was 5.57 billion euros on the finish of 2021 https://group.intesasanpaolo.com/content material/dam/portalgroup/repository-documenti/investor-relations/presentazioni-it/2022/Presentazione_FY21_IT.pdf, or 1.1% of the whole.

Its subsidiaries in Russia and Ukraine have property, respectively, of 1 billion euros and 300 million euros, which collectively characterize simply 0.1% of the group’s complete property. 

ING

The Dutch financial institution has round 4.5 billion euros in excellent loans with Russian purchasers and round 600 million euros with purchasers in Ukraine, out of a complete mortgage guide price greater than 600 billion euros.

ING mentioned many sanctions towards Russia had been in place since 2014.

($1 = 0.9016 euros)

(Further reporting by Brenna Hughes Neghaiwi in Zurich, Toby Sterling in Amsterdam, Alexandra Schwarz-Goerlich in Vienna, Elizabeth Dilts in New York; enhancing by John O’Donnell, Andrew Heavens and Jane Merriman)