Sberbank withdraws from Europe

Russia's Sberbank plans to leave the market of certain European countries due to sanctions imposed on it, Sberbank CEO and Chairman of the Board German Gref said.

"We are currently optimizing our activities in Europe, we plan to withdraw from a number of countries and optimize our European headquarters," he said during a broadcast on the Rossiya 24 TV channel.television channel.

"It is extremely difficult to work in Europe under sanctions," Gref pointed out.

Sberbank Europe AG, Austria, operates in the Czech Republic, Slovakia, Hungary, Croatia, Serbia, Slovenia, Bosnia and Herzegovina, in Republika Srpska within Bosnia and Herzegovina, as well as in Ukraine; SBE branches function in Germany. 

Russia's Sberbank 8-month net profit to RAS at 433.4 billion rubles, up 34.3% YR/YR (322.8 billion rubles in 2016). Sberbank August net profit at 60.6.4 billion rubles, up 26.8% YR/YR (47.8 billion rubles in 2016). 

The professor at the department of the stock market and investments at the Higher School of Economics, Alexander Abramov, speaking to Vestnik Kavkaza, noted that Sberbank's problems in Europe are really caused by the impact of sanctions on its activities. "It seems to me that its Eastern European projects in Central Europe, in particular in Austria, were not very successful. The problem is largely related to sanctions: Sberbank's subsidiaries in Europe are not able to issue securities, their activities are severely limited," the expert said.

"Most likely, Sberbank will leave Austria, perhaps Hungary and Bosnia and Herzegovina - first, they are regulated by European law, and second, they are not sufficiently loyal to the activities of Russia's state bank," Alexander Abramov added.

The economist drew attention to the fact that it will not have any impact on the financial performance of Sberbank. "In the long term, of course, it will be a problem, because the modern bank is a global bank. Rejected foreign projects would be a detriment to the bank's long-term strategy," he explained.

Sberbank's return to Europe will not be easy. "It will be much harder to start the project again, everyone will remember that Sberbank entered  the European market, but this attempt was unsuccessful. Sberbank may return to Europe, but it will not happen soon," Alexander Abramov concluded.