- Western banks operating in Russia are preparing to lose colossal sums by withdrawing from the country.
- The FT reported that banks are setting aside more than $10 billion in total to cover losses.
- Nearly 40,000 employees are also expected to leave the country, according to the FT report.
Western banks still operating in Russia could lose huge sums as they prepare to pull out of the country.
The Financial Times first reported the story.
According to some calculations by the FT, banks considering closing their Russian operations, which collectively have $86 billion of exposure in Russia, are setting aside more than $10 billion in expected losses.
It comes amid international sanctions forcing businesses and banks to cease operations in Russia over its invasion of Ukraine.
Banks still operating in Russia include Italian lender UniCredit, which set aside $1.3 billion (1.3 billion euros) as it could face a loss of $5.5 billion (5 .3 billion euros). The FT reported that UniCredit has been in business for 17 years and has 4,000 employees and 2 million Russian customers.
Two French banks, Société Générale and Crédit Agricole, have set aside $591 million (€561 million) and $410 million (€389 million) respectively. Societe Generale announced last month the sale of its entire stake in Rosbank to an investment company founded by Vladimir Potanin.
Raiffeisen, an Austrian bank, said it has 4.2 million customers and 9,400 employees in Russia. The newspaper reported that the bank had set aside $24 million (22.9 million euros).
Credit Suisse, which is being sued by a US law firm over claims related to Russian oligarchs, said it lost $211m (CHF206m) from the invasion, while fellow lender UBS said said it had reduced its risk exposure by a third to $400 million. .
US lenders Citigroup could face the biggest loss of any bank as they disclosed the biggest direct exposure to Russia with up to £3bn in potential losses, the FT reported. However, lenders set aside $1 billion last month.
JPMorgan said it has set aside around $300 million to cover potential losses, but CEO Jamie Dimon has warned it could lose up to $1 billion. Goldman Sachs said it suffered a net loss of about $300 million on investments related to Russia and Ukraine. The two banks announced at the beginning of March that they were liquidating their activities in Russia.
Insider contacted all banks for comment, but did not immediately receive a response.