Raiffeisen Bank International Remains on War Blacklist as Ukraine Stands Firm

This decision not only challenges the largest Western bank in Russia but also intensifies the pressure on one of Austria’s leading financial institutions.

The refusal was communicated through a letter sent to Raiffeisen earlier this month, as seen by Reuters.

Ukrainian officials questioned the bank’s commitment to severing ties with Moscow, citing vague and incomplete plans outlined by the institution.

Specifically, concerns were raised about the absence of a clear timeline for the sale of its Russian business, a move that Raiffeisen had previously intended to execute last year.

A spokesperson for Raiffeisen responded, highlighting the dependence on regulatory approval for any exit strategy from the Russian market.

However, this explanation failed to assuage Ukrainian authorities’ concerns, who emphasized the importance of concrete action over verbal commitments.

Despite lacking legal ramifications, the significance of the blacklist cannot be understated.

It serves as a symbolic gesture that has not only embarrassed Raiffeisen but has also elicited strong reactions from Austrian politicians and officials.

Austria, which publicly supports Ukraine, has been divided in its response to Raiffeisen’s predicament.

While some politicians successfully negotiated a temporary suspension of the bank’s inclusion on the list, others remain hesitant to sever longstanding ties with Russia completely.

This reluctance is compounded by the perceived unfair singling out of Raiffeisen, especially when compared to other international banks operating in Russia. Austria’s frustration with the arbitrary nature of the blacklist was evident when its foreign minister openly criticized the decision at a European ministers’ meeting in Kyiv last October.

Despite Raiffeisen’s temporary suspension from the blacklist in December, it continues to be listed alongside 49 other companies designated as “international sponsors of war” by Ukraine’s National Agency of Corruption Prevention.

The recent letter from Ukrainian officials underscores the ongoing uncertainty surrounding Raiffeisen’s departure from Russia and demands clarity on key aspects such as regulatory approvals and business reduction benchmarks.

In response to these developments, Raiffeisen announced advanced negotiations for the sale of its Belarusian subsidiary to a buyer from the United Arab Emirates.

While this move may signal progress in its divestment strategy, it remains to be seen whether it will be sufficient to appease Ukrainian authorities and secure removal from the war blacklist.

Main image: By Gennady Grachev from Moscow, Russia – Around Moscow, CC BY 2.0, https://commons.wikimedia.org/w/index.php?curid=70273305

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