frankfurt German financial regulator Bafin has banned major Russian bank VTB from exercising its voting rights in subsidiary VTB Bank Europe. As a result, the St. Petersburg parent company lost control of its subsidiary.
The move follows the EU’s fifth package of sanctions against Russia, which has just been imposed following the Russian attack on Ukraine, Bafin announced on Sunday. On Saturday, the EU approved its new sanctions against Russia. This also includes a complete ban on transactions at the expense of four major Russian banks, including the country’s second largest bank, VTB.
According to Bafin, Frankfurt-based VTB Bank Europe can no longer follow any instructions from the parent company. Weeks ago, the control authority had issued a ban on making payments or transferring assets in favor of the Russian mother. The supervisors emphasize that the daughter is now fully protected.
VTB Bank in Germany now under the supervision of the Bundesbank and Bafin
According to Bafin’s announcement, the operational business situation of VTB Bank Europe has basically not changed, the asset and liquidity situation remains orderly. “Depositors can continue to dispose of their money freely and borrowers can repay their loans with interest and principal. Other creditors of the bank can also be treated accordingly and accept payments from the bank, unless they themselves have been sanctioned. Other banks, service providers and employees may continue to work for VTB Bank Europe.
best jobs of the day
Find the best jobs now and
be notified by email.
>> Read also: VTB Europe in a state of emergency
Bafin and the Bundesbank have sent special representatives to the institute to monitor the “reduction of commercial activities”. The European subsidiary of VTB it has been in a state of emergency since the Russian invasion of Ukraine. Four out of five board members have now left the money house. As of early April, the only remaining board member was CFO Miro Zadro.
VTB Bank Europe client deposits are likely to have fallen
VTB Europe has raised a lot of money, especially from German private investors. At the end of September, customer deposits amounted to €4.4 billion. In the meantime, however, this sum is likely to have decreased significantly. The European Central Bank classified the European subsidiary of Russia’s largest financial institution, Sberbank, as “bankrupt or likely to fail” after the outbreak of the Ukraine war and closed it.
VTB Bank Europe was spared this fate. According to information from the Handelsblatt, after a special audit at the end of February, the financial supervisory authority decided that the institute could continue to exist. “If the bank’s situation changes, Bafin will promptly react with appropriate measures,” the supervisory authority said on Sunday.
Plus: Union politicians ask Scholz to travel to kyiv