Raiffeisen Bank’s russian subsidiary is accused of circumventing sanctions against russia

This is reported by The Bell.

 

“Shares in Raiffeisen Bank International fell by almost 10 per cent following a report by short-sellers Grizzly Research, who accused the Austrian bank’s russian subsidiary of potentially facilitating russia’s foreign trade transactions in circumvention of Western sanctions. RBI has denied the allegations,” the article states.

 

By continuing to operate in russia, RBI has become “one of the key channels for circumventing sanctions”, Grizzly Research noted.

 

Activist investors examined Russian customs records from 2022 to early 2025 and identified over 25,000 entries totalling $75 billion, in which the registration number of the russian Raiffeisenbank appeared in the foreign trade contract.

 

Of these, nearly 19,700 records worth $191 billion, according to Grizzly’s calculations, related to goods subject to restrictions imposed by the EU, the US, the UK and/or Switzerland. This also included Western-manufactured goods worth $106.75 million that are critical to the russian armed forces.

 

The identified supply records list lathes, various types of bearings, integrated circuits, switches and routers.

 

According to estimates by Ukrainian analysts, 70–80 per cent of CNC machine tools are consumed by the russian defence-industrial complex. The equipment is mainly procured by the company ‘AMG’, which was added to the US sanctions list in November 2023 and to the EU sanctions list in December 2024.

 

A separate audit of the counterparty database revealed transactions totalling $49 million involving at least 33 companies against which sanctions were already in place at the time (this amount is included in the main figure of $191 billion).

 

Grizzly believes that Raiffeisenbank facilitated trade in prohibited goods, but acknowledges that the customs records examined do not in themselves prove that payments were made under these agreements, nor that financing took place, nor that income was received, nor even that sanctions were breached.

 

The Bell reports that the investigation is based, in particular, on ‘undercover’ conversations with Raiffeisenbank employees. Activists posed as potential clients and deliberately described transactions designed to raise compliance concerns.

 

In particular, the investigators posed as a charitable foundation intending to purchase drones for use in war.

 

Several bank staff members replied that this would not prevent an account from being opened, with one manager giving her consent following approval from a senior manager. The foundation’s account details were reserved for 14 days prior to the formal opening, according to the report.

 

The RBI has rejected the allegations and stated that it is confident in the reliability of its compliance system.

 

Raiffeisen Bank International AG has stated that it has reviewed the short-seller’s report and categorically rejects the allegations. RBI is analysing its legal options and considering taking legal action against the authors of this report.

 

“In addition to numerous misleading and manipulative claims, the report contains a number of factual errors. For example, it claims that the authors identified clients whose accounts were voluntarily closed and frozen by RBI’s russian subsidiary, JSC ‘Raiffeisenbank’, even before these clients were included on sanctions lists,” the statement reads.

 

The report also mentions companies that have never been clients of either RBI or Raiffeisenbank JSC.

 

“Furthermore, the report demonstrates a fundamental misunderstanding of the liquidity coverage ratio and, in particular, ignores the conservative assumptions embedded in RBI’s liquidity reporting,” the statement reads.

 

RBI draws attention to its lawsuit against Rasperia. In the months leading up to the filing of the lawsuit in Austria, RBI provided detailed information to the US Office of Foreign Assets Control (OFAC) and the Austrian Financial Market Authority (FMA) regarding the content of the lawsuit and all the circumstances of the case, the statement notes.

 

On the eve of the filing of the claim, both authorities were informed once again, and the RBI continues to maintain regular contact with them.

 

The RBI’s group liquidity coverage ratio (LCR) stood at 136 per cent as at 30 June 2026 and comprised only high-quality liquid assets (HQLA) in an amount sufficient to cover 100 per cent of Raiffeisenbank JSC’s net outflow of funds.

 

This approach complies with the requirements of the EBA, the ECB and the Basel Committee regarding the calculation of the group LCR. This is a conservative adjustment which excludes more than €7 billion of Raiffeisenbank JSC’s high-quality liquid assets from the calculation of RBI’s group LCR.

 

Furthermore, the group’s LCR, excluding russia, stood at 135 per cent as at 30 June 2026, RBI emphasises.

 

The bank also mentions the sale of OJSC “Priorbank”.

 

“As part of the sale of the group’s Belarusian assets, RBI provided all relevant sanctions authorities with detailed information about the buyer and the financing mechanism for the transaction. The sale underwent a thorough review and was approved by the competent authorities,” the statement reads.

 

Source: The Bell, Ekonomichna Pravda