18.1 C
New York
HomeBusinessEconomyEuropean banks have most to lose in Russia

European banks have most to lose in Russia

AS THE WEST rolls out sanctions against Russia, some foreign banks, mostly European, will suffer collateral damage. Excluding the country from the SWIFT financial-messaging system will make it harder for them to collect payments on their loans. With the rouble so low, these are already less viable. The direct hit will be manageable: at $121bn, the stock of foreign bank loans to Russian firms and households has shrunk since 2014. But there are other costs. The investment-banking units of some big lenders may suffer losses on Russian securities, while private-banking businesses may be whacked by sanctions on Russian oligarchs. Retail-banking branches run by foreigners may also close. And if sanctions ratchet up, the risk of a government default will grow.

For more expert analysis of the biggest stories in economics, business and markets, sign up to Money Talks, our weekly newsletter.

This article appeared in the Finance & economics section of the print edition under the headline “Nyet interest”

Stay Connected
Must Read
You might also like


Please enter your comment!
Please enter your name here