The United States is putting pressure on Austria's Raiffeisen Bank International (RBI), the largest Western bank in Russia, to abandon plans to buy Russian oligarch Oleg Deripaska's €1.5 billion stake from Austrian construction company Strabag. Reuters reports this with reference to its sources directly familiar with the negotiations.
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Washington's intervention is likely to derail one of the West's largest agreements in Russia since the start of the great war in Ukraine and will increase pressure on the Austrian group processing billions of euros in cross-border payments for Russians , said two people.
Raiffeisen is buying a stake in Vienna-based Strabag from a company that the construction group considered controlled by Oleg Deripaska.
The bank called the agreement, which goes through Russia, a means of unblocking billions of euros stuck in Russia and potentially weakening ties with Russia. The news sent shares of the bank, which had been hit hard by its ties to Russia, higher in December.
In recent weeks, senior U.S. Treasury officials have emphasized their concerns about the agreement in meetings with the bank and Austrian authorities, the sources said. They noted that Deripaska is under sanctions.
US government representatives, who believe that Deripaska benefits from the sale, demanded that the bank provide details about the individuals and companies involved in the agreement.
If Raiffeisen moves forward despite this and the agreement is shown to be in conflict with US sanctions, Washington could impose penalties on the bank, two people said.
Raiffeisen would back out of the deal
Given the U.S. position, one person said Austrian authorities would not give the green light, while another said the bank itself was preparing to walk away from the deal.
A bank spokesman said it had “carefully checked that the Strabag agreement complies with all applicable sanctions prior to signing” and in recent weeks “informed all relevant authorities, including the US Treasury and OFAC (Office of Foreign Assets Control).
“It goes without saying that RBI will not renew any agreement that would violate sanctions or expose RBI to the risk of sanctions,” a bank spokesman said.
Deripaska’s spokesman pointed to preliminary remarks that said that he does not control the company that owns Strabag shares. He also called Western sanctions erroneous, based on false accusations.
Close ties with Russia
Two years after the start of the great war in Ukraine, Raiffeisen's continued presence in Russia underscores the close relationship between Austria and Russia, and how Vienna serves as a hub for cash from Russia and the former Soviet republics.
The bank is critical a financial lifeline for millions of Russian clients who want to send euros or dollars abroad, Reuters emphasizes.
“These conversations come amid ongoing regulatory scrutiny of Raiffeisen and its Russian connections, which began more than a year ago when US sanctions authority OFAC began looking into the bank's Russian business.
The Justice Department's Banking Integrity Unit The US is also checking Raiffeisen in connection with its Russian business,” the agency writes with a link to its sources.
RBI profits in Russia
Raiffeisen Bank International has enjoyed huge profits since the start of Russia's full-scale invasion of Ukraine thanks to its position as the largest European lender remaining in Russia.
In the nine months of 2023, more than half of the bank's profits came from its Russian unit. The bank is one of the largest creditors in Central and Eastern Europe.
Bypassing sanctions
In December 2023, the Ministry of Finance wrote that Raiffeisen Bank International entered into an asset exchange agreement with Oleg Deripaska , which allows you to bypass EU sanctions restrictions and transfer to the Russian his frozen capital amounting to 1.5 billion euros.
RBI said that its Russian subsidiary will make a cash payment to Deripaska in exchange for his 28% in Austrian Strabag. one of the largest construction companies in Europe.
Deripaska
Oleg Deripaska is the founder of aluminum production companies Rusal, Basic Element and En+ Group.
Share The Russian's Strabag, which he owned through his company Rasperia, was frozen last year by the EU in response to the bloc naming him as a Kremlin aide in the war against Ukraine.
