The VTB direct bank is a branch of the VTB Bank Europe SE and is under the supervision of the Bafin.
(Photo: Reuters)
Frankfurt What’s next for VTB Europe? This question has occupied the financial industry and thousands of customers since the outbreak of war between Russia and Ukraine. Now a possible solution is looming: The Russian parent company VTB has put its European subsidiary up for sale, two people familiar with the topic told the Handelsblatt.
Due to the war in Ukraine and the sanctions against Russia, however, it is uncertain whether a sale will succeed. Handling such a transaction without violating EU, US and UK sanctions is anything but trivial.
According to financial circles, the financial supervisory authority is following the process closely. VTB Europe is based in Frankfurt and is subject to the control of Bafin. The financial supervisory authority has been monitoring the bank intensively for some time and would probably have nothing against a sanction-compliant sale of VTB Europe. An uncontrolled collapse, which the supervisory authorities and private deposit insurance want to avoid, would then no longer threaten.
The Russian VTB and Bafin did not want to comment on a possible sale of VTB Europe, which Bloomberg first reported on.
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Since the beginning of March, VTB Europe has not been allowed to do any new business and is therefore no longer allowed to collect funds from private individuals. It manages currently remaining money market accounts and time deposit accounts, which are usually tied to a fixed term and cannot be terminated early.
Bank: We will continue to take care of our customers
According to the quarterly report, the bank had customer deposits of 4.35 billion euros at the end of September. However, this amount is likely to have decreased significantly in the meantime. The bank recently also reported equity of 1.1 billion euros.
On its website, the bank explains that it complies with all legal requirements and will continue to take care of its customers. “The economic situation of VTB Bank (Europe) SE is stable and the bank is fully functional.”
Because of the sanctions against Russian banks, the VTB parent company is largely cut off from the international financial market. VTB is on the list of banks excluded from the payment messaging system Swift. However, the European subsidiary is not affected. In Germany, the bank lured investors with annual interest payments of up to 0.65 percent on fixed-term deposit accounts through its subsidiary VTB Direktbank.
more on the subject: European subsidiary of VTB is no longer allowed to collect deposits