Russian Sberbank closed in UAE due to sanctions
2022.12.26 10:23
Russian Sberbank closed in UAE due to sanctions
Budrigannews.com – First Deputy Chairman Alexander Vedyakhin said on Monday that sanctions pressure will force Russia’s dominant lender Sberbank to close its office in the United Arab Emirates (UAE) early next year.
After Russia sent tens of thousands of troops into Ukraine on February 24, the financial system of the country was the target of severe Western sanctions. Sberbank is one of several major Russian banks that has been excluded from the international SWIFT payments system, and sanctions have also been imposed on some senior executives.
Vedyakhin told reporters, “Unfortunately, in the context of sanctions restrictions, we are facing serious constraints on our SberInvest Middle East office in Abu Dhabi, and we are unfortunately forced to close it in the first quarter of 2023.”
He stated that Sberbank would continue to serve UAE customers and was in active talks with Chinese regulators about opening an office there.
Vedyakhin stated, “I hope that we will be able to open a branch in China by the end of 2023; typically, this takes one and a half to two years.”
In March, the European Central Bank ordered the closure of Sberbank’s Vienna-based European division after the ECB warned that the bank could fail as a result of a run on deposits.
In the beginning of this year, the Bank of Russia instructed financial institutions to restrict their disclosures. Sberbank resumed some reporting this quarter, posting a decline in net profit of 84.8% year-over-year from January to November, beating the industry as a whole, which was still losing money as of November 1.
Vedyakhin declined to give entire year gauges yet said Sberbank was sure of being productive in December.
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According to Sberbank’s presentation, the bank’s corporate lending portfolio increased by 13.5 percent to more than 18 trillion roubles ($263.35 billion) in 2022, even after currency revaluation. The bank’s corporate client base increased by 3 percent to 3 million in 2022.
According to Vedyakhin, he anticipated that Russia’s corporate lending portfolio as a whole would expand by 12 to 14 percent in 2023 if inflation matched the central bank’s forecast of 5 to 7 percent and the key rate remained at or near current levels.
($1 = 68.500 roubles)
