Raiffeisen Bank International (RBI), an Austrian financial institution, is currently facing a significant legal battle over its business dealings in Russia.
The outcome of the upcoming court hearing on December 25 in Kaliningrad could result in fines of nearly two billion euros for RBI. The lawsuit, brought by Russian investment holding company Rasperia, seeks compensation of 1.9 billion euros. This legal dispute not only involves RBI but also has implications for the Viennese construction group Strabag and its Austrian shareholders.
The allegations stem from claims that Strabag and its core shareholders have devalued Rasperia's shares in the construction group due to Western sanctions. RBI asserts that it is not directly involved in the lawsuit and is not accused of any wrongdoing, but its Russian subsidiary's involvement could still have significant consequences for the bank.
RBI is currently under scrutiny from both the European Central Bank (ECB) and the U.S. sanctions authority, who are pressuring the bank to scale back its operations in Russia. Despite the ongoing sanctions, RBI has been able to generate a substantial portion of its profits from its Russian operations. However, the sanctions have made it difficult for RBI to access nearly six billion euros of equity tied up in Russia. The bank has faced challenges in navigating the complex regulatory environment, with previous attempts to transfer funds out of Russia being thwarted by the U.S. Treasury Department.
The outcome of the court hearing on December 25 will be closely watched, as it could have significant implications for RBI's future in Russia and how Western banks navigate doing business in the country amidst stringent sanctions.