9 Mar 2023 15:44

VTB might sell subsidiary bank in Angola due to sanctions

MOSCOW. March 9 (Interfax) - VTB might sell its subsidiary bank in Angola due to sanctions, the head of the Russian bank, Andrei Kostin, said in an interview with the French newspaper Les Echos.

VTB was one of the first to be added to the U.S. and EU sanctions lists, which hit the bank's international business hard, following the launch of the military operation in Ukraine in February last year.

"We haven't opened any new offices in other countries during the past year. We are looking at the possibilities. It is difficult for a sanctioned bank to expand geographically, with the possible exception of Iran. Expansion is difficult even in Africa. Our branch in Angola has suffered from the sanctions, and we'll probably have to sell it," Kostin said.

VTB owns 50.1% of Banco VTB Africa. The president of the Angolan state-owned company Endiama, Antonio Carlos Sumbula, owned the other 49.9% of the bank's shares.

VTB currently focuses on work in Russia and in countries with which there has a large volume of foreign trade, above all China, trade with which reached $190 billion in 2022.

"Our branch in this country is still small [a few percent of our total turnover]. But it will grow. The yuan, after it has caught up with the dollar and the euro, will for Russia be a currency in which settlements will be carried out, perhaps even in trade with other countries. I don't want to pay for anything in dollars anymore," Kostin said.

"We are a sanctioned bank and today we work only in the ruble zone, with Russian companies. We have lost our bank in Germany. Despite the fact that it still bears the name of VTB, it is not under our control. At the same time, we left it in good condition. We made an offer to Christine Lagarde, the head of the ECB, she is an unsurpassed specialist in the financial sphere. I know her well, but I no longer have contact with her. Our offer is simple: an asset swap. If you have problems with your assets in Russia, transfer them to us in exchange for our assets in Germany. Western banks have expressed interest in this. But not Western governments," he said.

VTB has been negotiating the exchange of assets of its subsidiary VTB Bank Europe for Russian assets of RBI, Frank Media said in September last year, quoting sources. The group tried to obtain permission from the European Central Bank for the swap deal.