Russian court blocks Austria's Raiffeisen Bank from selling local subsidiary
By Louis Goss
A Russian court has blocked Raiffeisen Bank International from selling its local subsidiary after the Austrian financier vowed to offload the unit last year.
In a statement, Raiffeisen Bank said a Russian court had placed a preliminary injunction on it selling shares in its Moscow headquartered subsidiary, AO Raiffeisenbank, which is one of the largest Western banks in Russia.
In March 2023, Raiffeisen Bank had previously said it would push ahead with a "sale or spin-off" of its Russian subsidiary in response to mounting pressure from the European Central Bank and U.S. authorities over its operations in the country.
Shares in Raiffeisen Bank International (AT:RBI), listed on the Wiener Börse AG in Vienna, fell 6% on Friday having previously gained 28% over the past 12 months.
Raiffeisen Bank first opened its fully-owned Russian subsidiary in 1996. The Austrian bank is now one of the few remaining Western multinationals with sizable operations in Russia following the country's invasion of Ukraine in February 2022.
The lender, which is currently Austria's second largest bank by revenue, had previously struggled to find a buyer for its Russian subsidiary, leading to it delaying any potential sale.
"As a result of today's decision RBI cannot transfer its shares in AO Raiffeisenbank. This complicates the sales process in which RBI seeks to sell a controlling stake in AO Raiffeisenbank - and will inevitably lead to further delays," the lender said in a statement.
The Vienna headquartered bank, which was first formed in 2010 as a subsidiary of Austria's Raiffeisen Zentralbank before absorbing its parent in 2017, said it now plans to appeal the Russian court's ruling.
"RBI will attempt to reverse today's court decision by all legal means," Raiffeisen Bank said in a statement.
The Russian court's decision relates to a separate, long-running dispute between the Austrian bank and Rasperia Trading Limited, which according to the U.S. Department of the Treasury is an investment firm controlled by sanctioned Russian oligarch Oleg Deripaska.
Raiffeisen Bank International had previously sought to buy a $1.5 billion stake in Austrian construction company Strabag from a company identified as being controlled by Derispaska. The Austrian bank later scrapped its plans in the face of pressure from Washington.
"[The Russian court's decision] is related to the legal proceedings recently initiated by Rasperia Trading Limited in Russia against STRABAG SE, its Austrian core shareholders and AO Raiffeisenbank," Raiffeisen Bank International said in a statement.
AO Raiffeisenbank is mentioned in the claim as related to the other defendants, although not accused of any wrongdoing. RBI is not a party to these proceedings," the bank said.
-Louis Goss
This content was created by MarketWatch, which is operated by Dow Jones & Co. MarketWatch is published independently from Dow Jones Newswires and The Wall Street Journal.
(END) Dow Jones Newswires
09-06-24 0704ET
Copyright (c) 2024 Dow Jones & Company, Inc.-
What’s the Difference Between the CPI and PCE Indexes?
-
Micron Earnings: Great Guidance but Stock Now Looks Fairly Valued
-
August PCE Report Forecasts Show More Good News on Inflation
-
AI Stocks May Be Down, but Don’t Count Them Out
-
4 Stocks to Buy as the Fed Cuts Interest Rates
-
Markets Brief: The Uncertain Path to Neutral Interest Rates
-
What’s Happening in the Markets This Week
-
Where Top Stock Fund Managers Are Looking Next After the Fed Rate Cut
-
Our Top Pick for Investing in US Renewable Energy
-
Undervalued by 25% and Yielding 5%, This Stock Is a Buy
-
Can AI Predict Future Stock Returns?
-
The Best Energy Stocks to Buy Now
-
10 Undervalued Wide-Moat Stocks
-
Obesity Drugs: Can New Firms Take Market Share From Eli Lilly and Novo Nordisk?
-
New 4-Star Stocks
-
Intel Fair Value Left Unchanged Despite Qualcomm Takeover Talk