FT: Raiffeisen Bank is expanding its Russian business instead of winding down

After the start of Russia's large-scale invasion of Ukraine, Austrian Raiffeisen Bank announced its intention to leave the Russian market, following the example of many other Western companies. However, the bank is apparently expanding its business in Russia.

Source. This was reported by the Financial Times.

The journalists found 2,400 job ads in Russia published by Raiffeisenbank since December 2023. Almost 1,500 of the offers are for sales and customer service managers, the article says.

One of the advertisements published by the bank's medium-sized business unit in Russia states that "the bank's key goals are to expand its active client base many times over and to achieve stable double-digit revenue growth."

It goes on to say that the company is "actively expanding its corporate client base" in the area of payroll services.

Two years after Russia started its war against Ukraine, Raiffeisenbank, which had previously announced its intention to leave the market, has become a Western credit institution "with the largest operations in Russia," the FT writes.

Today, it is under scrutiny by the US Treasury Department, and the European Central Bank is putting pressure on it to withdraw its assets from Russia, the journalists remind.

Representatives of Raiffeisenbank, contacted by the newspaper for comment, said that the FT's findings prompted the bank's chief executive Johann Strobl to order an "immediate investigation".

"The reduction of Russian business will continue in 2024. "Raiffeisen has continued to work on a potential transaction, sale or spin-off that would lead to the deconsolidation of Raiffeisenbank Russia from the group," the newspaper quoted the bank as saying.

At the same time, Raiffeisenbank noted that "the vacancy announcements do not reflect the measures taken by Raiffeisen Bank International to reduce its Russian business and do not correspond to future plans for the Russian business."

In turn, a senior Raiffeisenbank executive in Austria said that the job adverts in Russia were "extremely embarrassing" and caused a panic reaction, with demands to take them down and urgently rewrite them.

According to the bank's management, it is in a difficult situation, as profits earned in Russia cannot be returned abroad for further investment (repatriated), and any deal to sell its business in Russia requires the Kremlin's approval.

At the same time, the bank needs to keep its business in Russia operational in order to attract a buyer, while not openly supporting the Russian wartime economy, the bank added.