Economic news

UniCredit in court limbo over ECB’s Russia demands, sources say

2024.10.16 14:17

By Stefania Spezzati

LONDON (Reuters) – UniCredit is still awaiting a court decision over whether it must immediately reduce its Russia business to comply with a European Central Bank order, months after filing an objection, people familiar with the situation told Reuters.

The near four-month wait for a decision increases pressure on the lender to show it is complying with the ECB’s requests, whose deadlines have already passed.

The ECB, the lender’s chief supervisor, instructed UniCredit at the end of April to scale down its business in Russia including imposing a ban on new deposits and restrictions on handling payments.

In June, the Milan-based bank asked the European Union General Court to annul the demands, which Chief Executive Officer Andrea Orcel has said could breach Russian laws.

UniCredit has also sought to have the measure suspended while the court proceeding is pending, and in July said that a decision on a suspension was expected “in the coming months.”

Representatives for UniCredit, ECB and the European court declined to comment for this article.

UniCredit has said it “will continue to act on its commitment to significantly reduce its presence in Russia” and in July reiterated its 2025 targets to scale down its business there.

According to a summary of the court case which has not been previously reported, UniCredit asked the judge to annul all of the ECB’s demands or, alternatively, the orders regarding loans, deposits and payments. The ECB prohibited UniCredit from granting new loans or rolling over existing loans and imposed a ban on taking new term deposits from June 1, according to the court filings.

UniCredit is also contesting the ECB request to impose restrictions on payments with Russian clients in certain foreign currencies as of Sept. 1, with the exception of “whitelisted” clients.

Reuters could not establish which white list the ECB is referring to and whether UniCredit has complied with the ECB requests.

UniCredit said in a presentation to investors at the end of July that the bank aimed to reduce cross-border payments to below 8.5 billion euros ($9.3 billion) and local deposits below 2 billion by 2025.

RUSSIA TIES

The legal battle with the regulator comes as UniCredit is seeking the ECB’s approval to increase its stake in Germany’s Commerzbank (ETR:).

While the ECB has talked favourably about bank mergers in Europe, the Italian bank is facing hurdles in Germany, Reuters reported.

The ECB assesses purchases of bank stakes based on a handful of criteria such as the financial strength of the buyer and the reputation of the proposed acquirer, including court proceedings.

The regulator will also scrutinize whether the purchase increases risk of money laundering and financing terrorism, as expected under the ECB’s guidelines.

UniCredit’s ties to Russia date back to International Moscow Bank, the first Russian lender to raise funds from foreign banking institutions.

Following changes in ownership, it was renamed AO UniCredit Bank and in 2015 was included in the list of systemically important banks by the Bank of Russia.

© Reuters. FILE PHOTO: The UniCredit bank logo in the old city centre of Siena, Italy,  June 29, 2017. REUTERS/Stefano Rellandini/File Photo

When Russia invaded Ukraine in 2022, UniCredit remained in Russia, being one of two European banks – along with Austria’s Raiffeisen – to maintain large operations in the country.

($1 = 0.9190 euros)



Source link

Related Articles

Back to top button
bitcoin
Bitcoin (BTC) $ 86,205.10 7.08%
ethereum
Ethereum (ETH) $ 2,270.59 5.96%
tether
Tether (USDT) $ 0.999892 0.07%
xrp
XRP (XRP) $ 2.20 7.98%
bnb
BNB (BNB) $ 594.33 3.28%
solana
Solana (SOL) $ 146.16 14.02%
usd-coin
USDC (USDC) $ 1.00 0.00%
dogecoin
Dogecoin (DOGE) $ 0.208202 9.71%
cardano
Cardano (ADA) $ 0.651719 8.56%
staked-ether
Lido Staked Ether (STETH) $ 2,266.98 6.03%
tron
TRON (TRX) $ 0.234546 7.01%
wrapped-bitcoin
Wrapped Bitcoin (WBTC) $ 86,105.07 6.96%
litecoin
Litecoin (LTC) $ 129.99 6.57%
hedera-hashgraph
Hedera (HBAR) $ 0.229441 21.69%
wrapped-steth
Wrapped stETH (WSTETH) $ 2,713.62 6.05%
chainlink
Chainlink (LINK) $ 14.95 7.58%
avalanche-2
Avalanche (AVAX) $ 22.37 8.20%
stellar
Stellar (XLM) $ 0.296818 12.31%
sui
Sui (SUI) $ 2.91 13.03%
leo-token
LEO Token (LEO) $ 9.28 0.43%
shiba-inu
Shiba Inu (SHIB) $ 0.000014 5.26%
the-open-network
Toncoin (TON) $ 3.33 4.84%
usds
USDS (USDS) $ 1.00 0.08%
mantra-dao
MANTRA (OM) $ 7.61 4.78%
polkadot
Polkadot (DOT) $ 4.74 3.14%
hyperliquid
Hyperliquid (HYPE) $ 20.46 7.37%
weth
WETH (WETH) $ 2,269.89 5.72%
bitcoin-cash
Bitcoin Cash (BCH) $ 322.64 16.19%
ethena-usde
Ethena USDe (USDE) $ 0.998898 0.03%
bitget-token
Bitget Token (BGB) $ 4.13 6.88%
wrapped-eeth
Wrapped eETH (WEETH) $ 2,407.99 5.99%
uniswap
Uniswap (UNI) $ 7.62 4.02%
monero
Monero (XMR) $ 224.60 4.91%
whitebit
WhiteBIT Coin (WBT) $ 26.54 2.79%
aptos
Aptos (APT) $ 6.42 10.68%
near
NEAR Protocol (NEAR) $ 3.16 10.74%
pepe
Pepe (PEPE) $ 0.000008 6.50%
dai
Dai (DAI) $ 0.999744 0.00%
ondo-finance
Ondo (ONDO) $ 1.03 13.78%
internet-computer
Internet Computer (ICP) $ 6.57 5.20%
susds
sUSDS (SUSDS) $ 1.04 0.25%
ethereum-classic
Ethereum Classic (ETC) $ 19.60 9.14%
aave
Aave (AAVE) $ 194.73 4.27%
bittensor
Bittensor (TAO) $ 336.55 9.98%
official-trump
Official Trump (TRUMP) $ 13.91 22.42%
okb
OKB (OKB) $ 45.10 2.26%
gatechain-token
Gate (GT) $ 21.16 6.00%
mantle
Mantle (MNT) $ 0.737461 2.31%
coinbase-wrapped-btc
Coinbase Wrapped BTC (CBBTC) $ 86,218.10 6.98%
polygon-ecosystem-token
POL (ex-MATIC) (POL) $ 0.274686 4.90%