(17 May 2024 – Europe) The European Central Bank (ECB) has warned European Union (EU) lenders operating in Russia to accelerate exit plans to prevent incurring severe punitive measures from US regulators.
The Central Bank has requested Eurozone lenders provide them details of their plans to exit the country currently waging war on Ukraine. The move follows Austria’s Raffeisen Bank International being forced to abandon a deal last week which would have allowed them to swap assets in Russia for equivalents in Europe in the face of overwhelming pressure from US authorities.
The ECB sent letters to various banks which were still operating inside Russia and were written with different levels of severity based on the progress that they had made withdrawing from the region.
“This could lead to serious damage to the banking system if the US authorities take sanctions. The ECB’s response to the US interventions shows the big dependency of Europe on the US,” commented an adviser to the banks with Russian subsidiaries. “We are more followers than leaders on judgments involving European companies” said a spokesperson briefed on the ECB’s position.