Austria-headquartered Raiffeisen Bank International (RBI) agreed to sell its stake in its Belarusian subsidiary Priorbank, marking the first step toward fully withdrawing from the Belarusian market, RBI announced on Sept. 20.
RBI said it had signed an agreement to sell its 87.74% stake in Priorbank to Soven 1 Holding Limited, an investor from the United Arab Emirates, after more than six months of negotiations.
RBI has come under heavy criticism from Western institutions since the start of Russia's full-scale invasion of Ukraine for continuing its business in Russia and Belarus, thereby fuelling Russia's war through paying taxes.
Raiffeisen is the largest remaining Western bank in Russia. Hesitant to fully withdraw from the Russian market, the bank eventually announced in July 2024 that it would "drastically" reduce its operations in the country.
The decision came after the European Parliament sent Austrian officials a letter in April, urging them to compel Raiffeisen to cease its activities in Russia in compliance with EU sanctions.
The European Central Bank has also asked Raiffeisen to scale back its business in Russia by 2026.
The sale of Priorbank is expected to create a loss of around 300 million euros ($335 million), "which essentially results from the difference between the purchase price and the book value of the equity of Priorbank," RBI said.
With the completion of this transaction, "RBI will successfully withdraw from the Belarusian market and thus reduce operational complexity in line with its risk mitigation strategy in Eastern Europe," the Sept. 20 press release said.
Earlier in September, a Russian court issued a preliminary ruling that banned the transfer of Raiffeisen shares. "This complicates the sales process" and will "inevitably lead to further delays" in Raiffeisen's exit from Russia, RBI said.
Elsa Court
