Austria is under scrutiny from the United States over enforcement of Russian sanctions, with its major bank Raiffeisen Bank International (RBI) still the biggest Western bank working in Russia and potentially responsible for continuous flow of cash that circumvents sanctions.
The European country received the visit of Anna Morris, US Treasury official that works on illicit money flows. The aim of the visit is to urge Austria to check its business with Russia and explain a new sanctions authority the US is setting up. The new authority may pose a big risks for banks. The new measure is the continuation of recent US policies, including an executive order signed in December by President Joe Biden that threaten penalties for financial institutions that may help Russia.
Austria has been considered a relatively close country to Russia, with strong ties in finance and energy. The country has been often reluctant to backing European Union’s sanctions against Russia. According to Reuters, Austria was not supporting new sanctions until Ukraine levied its blacklist of RBI.
RBI is currently the major Western bank still operating in Russia with 2,600 corporate customers, 4 million local account holders and 10,000 staff and still enables international payments. Due to its presence in Russia, Ukraine added the bank to a list of “international sponsors of war” in an effort to pressure companies to leave Russia.
The continuous presence in Russia is becoming an issue for RBI, with some within the management and the regional Landesbanks in control of it that are pushing for dropping Russian business. RBI said that it wanted to spin off the business, however it hasn’t made big step towards it.
