VTB's European subsidiary winds down online retail platform VTB Direktbank
MOSCOW. May 10 (Interfax) - VTB Bank (Europe), the European subsidiary of Russian state lender VTB , is winding down online retail platform VTB Direktbank, the bank said on its website.
In April 2022, after the imposition of sanctions against VTB, the German regulator sidelined the Russian bank from the management of its European subsidiary and said that VTB Bank (Europe) was not subject to European Union restrictions.
Voting rights were handed to a trust manager, who decided to liquidate VTB Bank (Europe) starting on April 1, 2023. The liquidation process will take several years. Customers' deposits at the bank are protected by a two-tier deposit guarantee system.
"In the coming weeks and months, VTB Direktbank in Frankfurt will successively and in several tranches terminate existing contracts with savers and repay their deposits, including all interest accruing until payment," VTB Bank (Europe) in the statement on its website.
VTB Bank (Europe) has not accepted new deposits or raised interest rates on existing ones since February 2022, when sanctions were imposed against parent bank VTB due to the situation in Ukraine.
"We very much regret that we have to resort to such a measure, but we hope for the understanding of our customers for the special situation the bank is in as a result of the sanctions against Russia and against the parent company of our bank. Continuation of normal banking and deposit operations is impossible for VTB Direktbank under these conditions," VTB Bank (Europe) chief operating officer Hans-Georg Herrmann was quoted as saying in the press release.
The bank will ensure that customers "receive their deposits promptly and safely and can use them for reinvestment with other institutions," he said.
The assets of VTB Bank (Europe) shrank to 5.5 billion as of the end of June 2022 from 7.3 billion euros at the end of 2021, while funds in savings accounts and term deposits at the bank dropped to 2.6 billion euros from 4.1 billion euros.