Austria's Raiffeisen Bank International (RBI) was warned by the U.S. Treasury that its access to the U.S. financial system could be curbed due to its continued presence in the Russian market, Reuters reported on May 15.
The Vienna-based banking group is the largest remaining Western bank in Russia since Western companies exited the Russian market en masse after the start of the full-scale invasion of Ukraine.
Amid increasing pressure to scale down its activities in Russia, Johann Strobl, the CEO of RBI, said at the start of May that the bank is making plans to begin its exit from the country in the summer of 2024 in order to comply with European regulators.
Deputy Treasury Secretary Wally Adeyemo sent a letter on May 6 to RBI to express "concern about RBI's presence in Russia as well as a $1.5 billion deal with a sanctioned Russian tycoon that the bank has since scrapped," Reuters said, citing a person who had seen the correspondence.
Reuters was referring to reports that Raiffeisen was interested in buying a 1.5 billion euro ($1.6 billion) stake in the construction company Strabag, which is linked to Russian oligarch Oleg Deripaska.
The deal "was ditched by Raiffeisen days after the letter arrived," Reuters said, but there is still "deep frustration in Washington with the lender."
The bank has also frustrated Brussels, with the European Parliament sending Austrian officials a letter about RBI in April.
The European Parliament urged Austrian officials to compel Raiffeisen to cease its activities in Russia in compliance with EU sanctions after reports emerged that Raiffeisen was planning to continue and expand its operations in Russia.
Raiffeisen's activities "contribute to Russia's economy and budget, and provide financial resources for continued military aggression against Ukraine," the letter said.
Chris York
