From the article: It seems like kind of a "monkey trap." They don't want to write off their Russian assets, and they don't want Russia to have them, either, which would happen if they just abandon...
From the article:
Two years after Russia’s full-scale invasion of Ukraine, big European lenders continue to operate hefty, increasingly profitable units in the country despite public pledges to wind them down. The combined head count of the five European Union banks with the largest Russia operations has fallen by just 3% since the invasion, and earnings have roughly tripled, thanks to the fat interest rates they’re getting on their piles of cash stuck in the country.
The slow pace has spurred the European Central Bank to press the laggards to hasten their departures. One worry is that a continued presence in Russia risks exposing the banks to US sanctions and heavy fines, according to a person familiar with the matter who asked not to be named because the information is private. The watchdog has asked all banks with sizable businesses in Russia “to speed up their de-risking efforts by setting a clear road map for downsizing and exiting,” Claudia Buch, the central bank’s top oversight official, told euro-zone finance ministers on May 13.
Western sanctions that sharply limit companies’ scope of business in Russia, combined with local rules and punitive taxes on sales, make it tough for the banks to get money out of the country. Subsidiaries of foreign banks in Russia must of course adhere to local regulations, which can run counter to the ECB’s pressure on the parent company. And they face the risk of retaliation: The Kremlin sometimes seizes assets of companies or individuals from countries it considers unfriendly. Italy’s Intesa Sanpaolo SpA in September got authorization from President Vladimir Putin to sell its Russian unit to a group led by the unit’s local managers, but the deal has been slowed by bureaucratic hurdles, according to the bank’s chief executive officer, Carlo Messina. “It’s not easy to complete a disposal,” Messina told Bloomberg TV in February.
It seems like kind of a "monkey trap." They don't want to write off their Russian assets, and they don't want Russia to have them, either, which would happen if they just abandon them.
From the article:
It seems like kind of a "monkey trap." They don't want to write off their Russian assets, and they don't want Russia to have them, either, which would happen if they just abandon them.
Mirror, for those hit by the paywall:
https://archive.ph/3iG0t