Capital Economy, Business and Finance
Raiffeisen Bank made $1 billion and nearly half its profits for three quarters in 2024 from its Russian unit, Bloomberg reports.
The Vienna-headquartered lender was paid $620,000 to facilitate transactions between Unichim, a non-sanctioned Russian company, and sanctioned weapons manufacturers it supplied with chemicals.
The manufacturers produced parts for Russia’s missiles, glide bombs and navy vessels. Another Raiffeisen client in Russia supplied the sanctioned JSC Smolensk Aviation Plant with cables.
EU officials are “almost certain” the bank has more clients supplying Russia’s defense industry. Raiffeisen says it complies with all “applicable sanction legislation” and has tried under pressure from the European Central Bank to exit Russia for three years, having accumulated €4.4 billion of capital it is unable to repatriate.
Closing accounts is difficult under Russian laws which apply to Raffeisen, but clinging to its Russian business is costing the bank reputationally.
Raiffeisen, which has a market cap of $7 billion and is the largest western lender in Russia, has also supplied Unichim with $2.5 million equivalent in Chinese Yuan and processed Unichim’s transactions with bank accounts at sanctioned Sberbank, VTB Bank and the Commercial Bank Solidarnost.
According to Bloomberg’s investigation, Unichim supplied acids and other chemicals to Rawenstvo, a firm producing radar systems. Rawenstvo belongs to the sanctioned state-run Concern Granit-Electron, which produces key elements of missile systems and radio electronic warfare for Russia’s navy. The US Treasury has linked Concern Granit-Electron to the largest missile manufacturer in Russia. All three companies were sanctioned by the US and the EU after the invasion.
Unichim has also received payment for acids from Proletarsky Zavod, a sanctioned entity belonging to Russia’s largest ship producer making vessels for the Russian navy which is targeting Black Sea shipping and affecting grain exports.
“RBI has implemented monitoring and screening systems, tools and procedures to ensure that all transactions and business activities are duly monitored to be in strict compliance with applicable sanction legislation,” Raiffeisen’s spokesman said to Bloomberg by email.
