Tuesday 5/17/22
WAR IN UKRAINE

European subsidiary of Russia's Sberbank wound down due to sanctions

Sberbank Europe said €926 million ($924 million) has been paid out by the Austrian deposit insurance to customers in Europe

06 March 2022, Russia, Saint Petersburg: The logos of various payment systems with Sberbank written on them are pasted on a window of a store. Russia's largest bank - Sberbank - wants to ensure that people can pay and withdraw money with their cards even after Visa and Mastercard credit cards are switched off. Photo: Igor Russak/dpa.
The logos of various payment systems with Sberbank written on them are pasted on a window of a store in St Petersburg. Photo: Igor Russak/dpa.

The European subsidiary of Russia's Sberbank is being wound down in an orderly fashion, the bank said, in the face of sanctions imposed by the EU.

The sale of the Russian state majority owned bank's asset portfolio had averted insolvency, Vienna-based Sberbank Europe said on Tuesday evening. It added that savings deposits were to be repaid in full.

The move comes as Russia's invasion of Ukraine continues, despite rounds of sanctions on Moscow imposed by the West in an attempt to halt the war since it began on February 24.

In early March, the Austrian Financial Market Authority (FMA) ordered the bank to cease operations and appointed a state administrator as the bank was set to fail.

Sberbank Europe said €926 million ($924 million) has been paid out by the Austrian deposit insurance to customers in Europe.

Deposits exceeding €100,000

The bank has now repaid the €926 million to the Deposit Guarantee Scheme Austria, it said. It added it would also now pay out savings deposits exceeding the maximum secured amount of €100,000.

"Sberbank Europe AG hereby continues its orderly wind-down," the bank said in a statement.

The European Commission meanwhile still plans to propose a sixth round of sanctions on Russia to member states, which would also include measured targeting Sberbank. The sanctions are now expected to be announced in the European Parliament on Wednesday morning.

European subsidiary of Russia's Sberbank wound down due to sanctions
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