Alpine Exemptions

Austria Shields Russian Banks from E.U. Sanctions

The Sberbank in Russia's far eastern port of Vladivostok. The message reads "Sberbank. Always nearby." Source: Reuters
The Sberbank in Russia's far eastern port of Vladivostok. The message reads "Sberbank. Always nearby."
  • Why it matters

    Why it matters

    Austria feared sanctions against two Russian banks managing their European affairs from Vienna could have exacerbated the Alpine country’s financial crisis.

  • Facts

    Facts

    • Sanctions imposed by the European Union and the United States are in response to Russia’s influence in the Ukrainian civil war.
    • Austria has close banking and economic ties with Russia.
    • In E.U. talks about tougher economic punishment against Russia, Austria made sure Russia’s VTB and Sberbank were excluded.
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    Audio

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Austria is considered within the European Union to be a member that cultivates especially close ties with Russia. President Vladimir Putin of Russia can count on support from Vienna.

In E.U. negotiations about tougher economic punishment against Russia, Austria made sure large Russian banks VTB and Sberbank, both which manage their European affairs from Vienna, were excluded from a new round of tougher sanctions.

Austria wanted to protect its troubled banking sector from further disruptions, reported the newspaper Wiener Zeitung. VTB and Sberbank didn’t respond to inquiries, nor did the Austrian Foreign Ministry have a comment before Handelsblatt went to press.

The United States has placed VTB, Bank of Moscow and Russian Agricultural Bank on the sanctions list, according to the U.S. Treasury Department. All large banks whose majority of shares are owned by the Russian state are affected by the sanctions. The only exception is Sberbank.

Sanctions imposed by the European Union and the United States are in response to Russia’s behavior in the Ukrainian civil war. The West accuses Russia of supporting the pro-Russian separatists and of not supporting peace efforts. Moscow has rejected the accusations.

With the exemptions insisted upon by the Vienna government for Russian banks in Austria, Chancellor Werner Faymann and his finance minister, Michael Spindelegger, have achieved an important victory for the small country’s crisis-hit financial sector.

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