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According to the European Central Bank (ECB), the European subsidiaries of the Russian Sberbank, which has been sanctioned for the Russian attack on Ukraine, will “fail or are likely to fail”.
Sberbank is one of the largest banks in Russia. On Saturday, western states excluded the bank from the Swift international financial system as part of sanctions once morest Moscow.
imago images / Pixsell
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Due to the effects of the Russian invasion of Ukraine, the liquidity of Russia’s Sberbank of Russia PJSC in Europe has deteriorated drastically.
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Payments, enforcement and termination rights have been suspended.
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The European Central Bank (ECB) is said to have taken action once morest Sberbank Europe AG and its Croatian and Slovenian subsidiaries.
Sberbank of Russia PJSC’s main business in Europe has been declared failing or likely to fail by regulators following its liquidity deteriorated due to the impact of Russia’s invasion of Ukraine, reports the business daily «Bloomberg».
The European Central Bank (ECB) is said to have taken action once morest Sberbank Europe AG and its Croatian and Slovenian subsidiaries following determining that the bank is unlikely to be able to pay its debts or other liabilities when they fall due.
Due to the “impact of geopolitical tensions on its reputation”, the bank, which is majority-controlled by the Russian state, had to “accept significant outflows of deposits”, the ECB announced on Monday night. The US said last week that it would impose sanctions on five of Russia’s largest banks, including Sberbank and VTB Bank PJSC.
«No withdrawals, transfers or other transactions»
Meanwhile, the Single Resolution Board (SRB), which deals with troubled European lenders, has applied a suspension of payments, enforcement and termination rights to Sberbank’s three European divisions. Sberbank Europe AG is therefore not allowed to “carry out any payments, transfers or other transactions”. The only exception to the payment moratorium is for depositors, who are allowed to withdraw a maximum of 100 euros per day to cover “essential daily needs”. At the same time, it was emphasized that deposits of up to EUR 100,000 continue to be secured by the Austrian deposit guarantee system.
Sberbank is one of the largest banks in Russia. On Saturday, western states excluded the bank from the Swift international financial system as part of sanctions once morest Moscow. The Swift exclusion is intended to hit the Russian economy hard: the banks concerned can no longer communicate with financial institutions in other countries. This will slow down or completely prevent the flow of payments and goods. Foreign companies operating in Russia are therefore also affected by the sanctions.
(AFP / sys)
