(MENAFN) Austria's Raiffeisen Bank International, the largest foreign lender in Russia, faces the threat of being "cut off from the United States financial system" if it is discovered to have supported the funding of Russia's military, warns the United States Treasury Department, according to Reuters. As part of the renewed push on sanctions, the United States Treasury encourages Austrian banks, including Raiffeisen, to assess their exposure to Russia and consider taking mitigating measures, says top Treasury official Anna Morris.
The United States Treasury's warning comes amidst increased scrutiny on foreign banks operating in Russia, aligning with Washington's efforts to exert pressure through sanctions. Raiffeisen Bank International, one of the last major Western lenders still present in Russia, has confirmed engaging in discussions with United States authorities regarding potential sanctions related to its business activities in Russia.
While Raiffeisen did not divulge specific details, the bank stated that it typically refrains from commenting publicly on discussions with authorities as a matter of principle. Raiffeisen is notably one of two foreign banks listed as systemically important credit institutions by the Russian central bank, the other being Italy's UniCredit. Several other Western banks, including ING, Commerzbank, Deutsche Bank, OTP Bank, Intesa SanPaolo, and SEB, continue to maintain a presence in the Russian market.
In response to mounting pressure from Western governments, Raiffeisen had previously announced plans to spin off its Russian business by September of the previous year. However, the RBI Group, which owns the bank, has faced resistance against expediting its exit from Russia, facing demands from both the United States and the European Union. The European Central Bank (ECB) has also been pressuring Raiffeisen to withdraw from the Russian market.
The potential imposition of sanctions on Raiffeisen Bank International underscores the broader geopolitical tensions and the intricate relationship between global financial institutions and governments. As financial institutions navigate the complexities of international sanctions and geopolitical dynamics, the outcome of these discussions may have far-reaching implications for Raiffeisen and other Western banks operating in Russia. The development highlights the intricate challenges financial institutions face in balancing their global operations with compliance in an environment of shifting geopolitical landscapes and sanctions regimes.
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