By Lawrence White
LONDON (Reuters) – Russia’s second-biggest bank VTB is closing its London-based investment banking unit VTB Capital, it said on Tuesday, as Western sanctions continue to throttle the international operations of Russia’s lenders.
VTB Capital is “currently proceeding with an orderly wind-down of its positions and obligations,” the company said on Tuesday, having let go some of its staff late last week.
VTB’s announcement is the latest sign of how U.S., European and British sanctions are hitting Russian financial firms, after the country’s biggest lender Sberbank quit Europe blaming cash outflows and threats to its staff and property.
It shows the pressure Russian businesses face from the unprecedented and coordinated action by Western governments to isolate Moscow, including sanctions on its central bank and the exclusion of some lenders from the SWIFT payments system.
Reuters reported earlier this month that regulators are preparing for a possible closure of the European arm of VTB Bank, amid growing concerns about the impact of Western sanctions on the bank following Russia’s invasion of Ukraine.
Moscow calls its actions in Ukraine a “special operation”.
(Reporting by Lawrence White; Editing by Kirsten Donovan and Louise Heavens)
