Austrian Bank scrutinized for alleged Russian war ties

Austrian Raiffeisen Bank International AG (RBI) has been accused of benefiting from activities supporting the Russian war industry.

According to Bloomberg, the bank obtained 62 million rubles ($620,000) from services provided to Russian chemical firms supplying products to the military industry.

In 2024, the Russian branch of Raiffeisen generated over a billion dollars in profits, accounting for nearly half of the bank's total profits. Nevertheless, due to Russian regulations, the headquarters in Vienna has no access to these funds.

Bloomberg emphasizes that the bank has implemented monitoring systems to ensure compliance with sanctions.

Raiffeisen is one of the few Western banks remaining in Russia after Ukraine's invasion in 2022. The Russian bank branch is recognized as a key financial institution, making withdrawal from the market challenging. The decision to leave Russia requires the consent of a special commission and Vladimir Putin.

Bloomberg revealed that Raiffeisen handled transactions for Unichim, which supplies chemicals to the sanctioned military entity Rawenstvo. Unichim also traded with Proletarskij Zavod, part of United Shipbuilding Corp., which indicates ties with the Russian navy.

In the first half of 2024, Raiffeisen made 17.8 million Chinese yuan ($2.5 million) available to Unichim, which may suggest interests aligned with China. Bloomberg notes that Russia, circumventing sanctions, is increasingly using Chinese raw material suppliers.

Raiffeisen hopes that sanctions will be eased in the event of a ceasefire, enabling the transfer of profits to the Vienna headquarters. Bloomberg highlights that currently, these funds are frozen in Russia, subject to local regulations and sanctions.