Austria’s RBI Sees Russian and Ukrainian Businesses Running Normally

RBI's Russian and Ukrainian Operations Remain Stable

VIENNA (Reuters) – Raiffeisen Bank International’s operations in Russia and Ukraine have not been affected by tensions between the neighbours that have prompted Western sanction threats should Russia intervene militarily, the bank said on Wednesday.

“Our banks in Russia and Ukraine are in good shape. Business is running normally despite the geopolitical tensions,” Chief Executive Johann Strobl said as the Austrian lender, which operates across central and eastern Europe, presented preliminary results.

The CEO also ruled out a withdrawal from its key market Russia, where it has exposure of 22.85 billion euros ($25.77 billion), including 11.6 billion in loans to customers, 11.5% of the group’s total.

“We make no such considerations,” Strobl said.

Russia has massed more than 100,000 troops on the Ukrainian border, fueling concerns in the West that Russian President Vladimir Putin may be planning to invade its neighbour. Russia denies this but has said it could take unspecified military action unless certain security demands are met.

RBI was monitoring developments very closely and had already made provisions in the second half of the year in line with its prudent risk policy, the CEO said.

“Exposure to Russia and Ukraine (is) well within the limits which ensure resilience of the group under all possible scenarios,” the lender said in a presentation slide.

RBI said it had taken 115 million euros in provisions for possible sanctions risks in Russia and that it currently sees no need for devaluations in Russia or Ukraine.

In Russia, 81% of its lending was in roubles, with foreign exchange lending limited to borrowers with matching foreign currency income. In Ukraine, it had 2.2 billion euros in customer loans.

($1 = 0.8868 euros)

(Reporting by Alexandra Schwarz-Goerlich; writing by Michael Shields, Kirsti Knolle; editing by Jason Neely and Louise Heavens)