Hungary’s largest bank is considering withdrawing from russia

This is evidenced by documents seen by Bloomberg, according to Ukrinform.

It is noted that OTP is one of the few European banks that continued to operate in russia following its full-scale invasion of Ukraine. OTP has stated that it has scaled back its operations in the russian federation: its share of the russian banking market currently stands at around 0.4 per cent in terms of total assets. At the same time, the bank has already repatriated around $880 million in dividends from its russian operations.

The bank’s operations in russia are currently attracting particular attention from regulators, as OTP is seeking to acquire the Baltic bank Luminor Bank AS. If approved, this would be the largest acquisition in the Hungarian bank’s history and would expand its presence in the eurozone. In the coming weeks, the European Central Bank and the Estonian banking regulator are due to make a decision on the planned acquisition.

“Given our strategic interest in the Baltic states and the limited progress in increasing additional dividends from russia over the past year, OTP has begun reviewing its strategy regarding russia, including a possible complete exit from the russian market,” OTP Group CEO Péter Csányi told Bloomberg.

He added that the review of the strategy is expected to be completed by the end of the year.

The bank noted that the repatriation of dividends has reduced its risks associated with russia. According to OTP, these funds are not being used to finance the acquisition of Luminor or for other corporate purposes.

OTP also stated that, following the outbreak of full-scale war, the bank suspended corporate lending in russia, scaled back international payment transactions – in particular, ceasing to process customers’ transactions in US dollars – withdrew intra-group financing from the country, and its operations there are now almost entirely focused on retail lending.

Overall, OTP reported that during this period it had reduced its workforce in russia by 25 per cent and its branch network by 40 per cent. At the same time, the bank continues to expand its operations in Ukraine: in 2025 alone, its Ukrainian subsidiary increased its loan portfolio by 35 per cent.

“OTP is not a systemically important player in russia. In Ukraine, however, OTP is classified by the National Bank of Ukraine as a systemically important bank,” the Hungarian bank stated.

At the same time, OTP continues to facilitate settlements for trade transactions between the EU and russia on behalf of Western companies that remain active in the russian market. All payments in euros between russia and the EU, the European Economic Area and the UK are checked at the bank’s headquarters in Budapest to ensure compliance with sanctions.

OTP emphasised that it complies with the sanctions currently in force imposed by the UN, the EU, the US and the UK, and has not yet identified any breaches of sanctions legislation by any company within the group.

Documents reviewed by Bloomberg suggest that OTP’s clients included companies that provided services to russian state bodies, in particular the russian Foreign Intelligence Service (GRU). The bank’s former clients also included an organisation linked to businessman Konstantin Malofeev, who has been sanctioned for spreading propaganda and financing russia’s illegal annexation of Crimea in 2014.

Like other banks that continue to operate in russia, OTP is obliged to comply with local regulations, in particular to maintain client accounts and process rouble transactions within the country. This complicates the search for a buyer who would meet the requirements of both Western regulators and the russian authorities, and could result in losses for OTP should it withdraw from the russian market. The bank also noted that, in the event of a sale of its russian assets, sellers would only be permitted to sell them for approximately 5 per cent of their market value. “At present, a sale is practically impossible,” OTP stated.

Source: Bloomberg, Ukrinform