The number of banks with foreign capital fell to a record level in Russia

In Russia, the number of banks with foreign participation fell to its lowest level in the past ten years. Since the beginning of 2024, they have decreased from 89 to 85 in October, RosSMI reports, citing data from the Central Bank of the Russian Federation.

Of these 85 banks, 78 have universal licenses, and seven others have basic licenses, limiting their ability, in particular, to open branches.

The decrease in the number of banks with foreign capital occurs against the backdrop of the sale of Russian assets by foreign owners, especially from “unfriendly” countries.

In particular, in May 2024, Russian assets were bought by the British HSBC Expobankand Dutch Yandex NV closed the sale deal Yandex-Bank top management of the corporation. Two foreign banks also liquidated their Russian branches, including Switzerland’s Cramer & Cie SA and American Express’ Russian subsidiary.

The volume of transactions of banks with foreign capital is also decreasing due to the restrictions imposed by the regulators of the main companies. So, under pressure from the European Central Bank, UniCredit and Raiffeisenbank. This is also related to the risks of secondary sanctions for subsidiaries of international banks. The departure of foreign players leads to a decrease in competition in the market, which may cause an increase in tariffs and banking commissions.

The development of the situation depends on political sanctions and sanctions, and it is possible that the number of banks with foreign participation in Russia will continue to decrease.

Let’s recall that at first the banks of the United Arab Emirates tightened control over transactions related to Russian companies.

The State Bank of Russia VTB, which came under Western sanctions and was disconnected from the SWIFT system, is closing its only subsidiary in Africa.