Austria is attempting a diplomatic move to have Raiffeisen Bank International, the largest Western bank in Russia, removed from a Ukrainian blacklist in exchange for endorsing new European Union sanctions against Russia, according to Reuters.
The maneuver underscores Austria’s economic ties with Russia, the bank’s commitment to sustaining its profitable business in the country, and a diminishing Western effort to isolate Moscow.
Austria and Raiffeisen are pushing for the bank’s removal from a Ukrainian list labeled “international sponsors of war,” designed to publicly shame companies doing business with Russia. This implies support for the war effort through activities like tax payments. Despite Austria’s public support for Ukraine, officials express reluctance to sever decades-old ties with Russia, believing in the possibility of restoring relations.
In October, Austria’s Foreign Minister, Alexander Schallenberg, openly criticized the blacklist as arbitrary during a European ministers’ meeting in Kyiv. Raiffeisen remains the sole Austrian company on the contentious list. Austrian officials have raised their concerns about the list in Brussels, discussing the issue at meetings with EU officials and diplomats in recent weeks.
Bank representatives have engaged with Ukraine’s National Agency of Corruption Prevention, responsible for the list, to explore avenues for Raiffeisen’s removal. While some companies, like Hungary’s OTP Bank, have been successfully delisted due to government intervention, this move has displeased Austrian officials and Raiffeisen.
A Raiffeisen spokesperson expressed dissatisfaction, stating, “We find it unfair that we are on the list.” The Austrian chancellery acknowledged the presentation of legal documents related to EU sanctions but refrained from providing further comments.
Raiffeisen’s presence in Russia underscores the deep economic ties between Austria and Russia, facilitated by Russian gas pipelines and financial connections. Austria’s lobbying efforts, echoing Hungary’s actions, risk undermining Europe’s unity on the Ukrainian issue.
While the Ukrainian blacklist lacks legal standing, its symbolic importance adds pressure on Raiffeisen to withdraw from Russia. The bank has expressed willingness to exit Russia, but concrete actions are yet to materialize. Raiffeisen had planned to spin off its Russian business, facing international regulatory pressure. Despite internal divisions within Raiffeisen’s management and among the controlling Landesbanks, key Austrian officials are staunchly supporting the bank, integral to the country’s economy.
Raiffeisen, with approximately 2,600 corporate customers, 4 million local account holders, and 10,000 staff in Russia, has become a litmus test for Western resolve to sever ties with Russia. Russian authorities have signaled a desire for Raiffeisen to stay, citing its role in facilitating international payments.
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