30 Mar 2023 14:12

RBI decides to spin off Russian subsidiary, considering sale

MOSCOW. March 30 (Interfax) - Raiffeisen Bank International (RBI) has decided on the fate of its Russian business which it plans to either sell or spin off, the Austrian group's CEO Johann Strobl said.

Strobl said the group had been assessing all options for its Russian bank, including a carefully managed exit, since February last year.

He said at this year's AGM that the group had decided to "progress potential transactions which would result in the sale or spin-off of Raiffeisenbank Russia and deconsolidation of Raiffeisenbank Russia from the RBI Group."

He said this would be done in full compliance with local and international laws and regulations and in consultation with the relevant competent authorities.

"We will further reduce business activity in Russia while we continue to progress such a potential transaction. Raiffeisenbank will maintain some banking operations in Russia to meet the conditions of its banking license. It will continue to support customers including those impacted by the reduction in business activity. RBI has a duty of care to employees in all markets where RBI operates," Strobl said, recalling that the Russian division had more than 9,000 employees.

RBI Group assets in Russia include Raiffeisenbank and leasing, insurance and management companies.

RBI has narrowed the number of applicants for the Russian business to two, the Financial Times newspaper writes, citing an unnamed top manager of the group. In the coming weeks, the group will work intensively to assess the possibility of a deal. RBI hopes to be able to agree terms for exiting the Russian market this year, the newspaper notes.

Currently, in order to sell the majority of assets in Russia and comply with Russian regulations, non-residents must adhere to a number of conditions, including obtaining special permission from the Russian President. Raiffeisenbank is included in the list of credit institutions whose capital can be withdrawn as an "unfriendly" non-resident only by special permission.

One option for RBI's Russian assets could be to separate the business into a separate structure with a listing in Europe, the Financial Times notes. This option is more expensive, but more politically viable, the newspaper said.