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VIENNA (Reuters) – Austria’s finance ministry on Thursday played down concerns about U.S. sanctions officials scrutinising Raiffeisen Bank International over its Russia business.
Raiffeisen shares fell sharply last month after the company received a request for information from the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) to “clarify payments business and related processes maintained by RBI in light of the recent developments related to Russia and Ukraine”.
“The inquiry from the U.S. sanctions authority is a normal process that gives no cause for concern, because sanctions authorities naturally keep informing themselves about Austrian companies doing business in Russia,” Austria’s finance ministry told Reuters in a statement.
Raiffeisen is deeply embedded in the Russian financial system and is one of only two foreign banks on the Russian central bank’s list of 13 “systemically important credit institutions”, underscoring its importance to Russia’s economy which is grappling with sweeping Western sanctions.
The bank has said it is cooperating fully with OFAC and that it understood the request was not triggered by a specific transaction or business. It said it had processes in place to ensure compliance with sanctions.
The Austrian finance ministry said it would in due course address questions from parliament about Raiffeisen, as the lender’s activities drew more domestic political scrutiny.
The Greens, the junior party in Austria’s ruling coalition, expressed concern on Thursday that the issue could damage the country as a financial centre. That followed media reports that RBI would attempt to hoover up the remains of the Vienna-based European subsidiary of Russia’s Sberbank, which was forced to close after the outbreak of the war in Ukraine.
“A risky deal for the Austrian Raiffeisen, which instead of – like other European banks – ending its business in Russia, is focusing on intensifying business relations,” Greens lawmaker Nina Tomaselli said in a parliamentary question.
The finance ministry welcomed the prospect of such a deal, suggesting it could prevent losses to savers and deposit insurance of hundreds of millions of euros.
