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April 4, 2022updated 05 Apr 2022 7:21am

Russia’s Sberbank to close down London investment arm amid sanctions

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by GlobalData
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Russia’s Sberbank is pulling the plug on its London-based investment arm Sberbank Corporate & Investment Business (Sberbank CIB), reported Russian News Agency TASS.

The development comes as numerous sanctions by the US and its allies continue to target Russia over its invasion of Ukraine.

The Financial Conduct Authority (FCA) in the UK placed the unit under special administration, saying that it was ‘operationally unable to make payments’ after sanctions were imposed against Sberbank.

Sberbank said that its decision to wind down the London office was made based on a reassessment of the economic potential of the presence of its Global Markets business in the UK.

The Russian lender said: “Sberbank is ceasing the operation of its London office, Sberbank CIB (UK) Limited. We are in contact with the local regulator, the FCA, and in accordance with the law we will close our activities, fulfilling all obligations to our clients,”

The bank added that its employees will continue to fulfil their current roles.

Sberbank CIB specialises in investment banking services, corporate finance, as well as market trades operations with securities.

FCA said in a statement: “Sberbank CIB’s failure is the consequence of the ability and risk appetite of critical suppliers to work with firms with links to the Russian state following the invasion of Ukraine and the global imposition of sanctions.

“Having considered the firm’s position, the directors concluded that the firm is insolvent and applied to court to place the firm into special administration.”

 The FCA appointed joint special administrators to oversee the assessment of the client money and custody assets held by the unit.

The special administers will work to return client money and custody assets to customers in line with applicable law.

Last week, a report by Sky News said that VTB Capital, the London-based investment banking unit of sanctioned Russian bank VTB, is facing insolvency proceedings in the aftermath of sanctions.

Free Report
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How attractive are current investment opportunities in Europe?

Europe has been identified as one of the most favorable regions for investors, seeing high investment activity in the past year. Most of these investments have been through Debt Offering, valued at close to $700 billion. The region has provided attractive investments in a diverse set of companies. Companies who tend to major themes such Digital Media, Cloud, Artificial Intelligence, E-commerce, and Big Data are recording the highest number of deals, with Digital Media recording close to 2,000 deals. However, GlobalData’s whitepaper offers a full view of the market, analyzing less successful or attractive points of investment as well, examining statistics on Equity Offering investments and PE/VC deals. Understand how government agencies for economies around the world use GlobalData Explorer to:  
  • Track the M&A and Capital Raising volumes into their target market
  • Identify the top sectors in the target market attracting the investments
  • For any investment segment, identify the top Investors inside and outside the target economy that are already investing in the Segment
  • Assess and showcase the growth potential for various Industries in the target economy
Don’t miss out on key market insights that can help optimize your next investment – read the report now.
by GlobalData
Enter your details here to receive your free Report.

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