The U.S. government is reportedly pressuring Austria’s Raiffeisen Bank International (RBI), the largest Western bank operating in Russia, to abort its planned acquisition of a €1.5 billion industrial stake owned by a Russian tycoon, Oleg Deripaska. This U.S. intervention is poised to thwart one of the most significant Western investments in Russia since the onset of the Ukraine conflict. The RBI has a long history of facilitating global money transfers of Russian oligarchs.
The Austrian bank is renowned for facilitating billions of euros in international transactions for Russian clients. RBI‘s proposed acquisition involves purchasing a stake in the Vienna-based construction group Strabag, a deal linked to entities controlled by Russian oligarch Oleg Deripaska. This transaction, which routes through Russia, was initially portrayed by the bank as a strategy to liberate billions of euros trapped within Russia while potentially diminishing its reliance on the Russian market. Despite initially boosting RBI‘s stock value, this plan has now drawn significant scrutiny from U.S. Treasury officials, who have expressed concerns in recent discussions with both the bank and Austrian regulators, particularly given Deripaska’s sanctioned status.
The United States’ stance is that the sale would ultimately benefit Deripaska, leading to demands for detailed information about the parties involved in the deal. Failure to comply with U.S. sanctions could result in punitive measures against RBI, raising questions about the bank’s compliance and due diligence processes. In response, RBI has asserted its commitment to adhering to all applicable sanctions, emphasizing that it would not proceed with any transactions that could breach these sanctions or expose the bank to related risks.
The situation highlights the intricate web of financial relationships between Austria and Russia. RBI serves as a crucial conduit for Russian customers seeking to make international payments in euros or dollars. The ongoing scrutiny of RBI by regulatory bodies, including the U.S. Department of Justice and the Office of Foreign Assets Control (OFAC), underscores the broader geopolitical tensions surrounding Austria’s business dealings with Russia.
RBI‘s stock experienced a significant downturn following these revelations, leading to the cancellation of a planned €650 million bond sale due to adverse market reactions. This development, coupled with the EU’s request for clarifications from Austrian authorities and ongoing dialogue with U.S. officials, signals the complexities of navigating international sanctions and the delicate balance of interests among the involved nations.
Austria’s defense of RBI, motivated by national economic considerations and perceived U.S. overreach, reflects the tension between maintaining business relationships with Russia and adhering to international sanctions. The case of RBI and its attempted deal with Deripaska serves as a litmus test for Western resolve in severing economic ties with Russia amidst calls for accountability and compliance with global sanctions regimes.
