Raiffeisen is not rushing with its exit, while officials in Vienna have defended long-standing ties with Moscow, the outlet has reported © Getty Images/Fotokot197

Austrian banking group Raiffeisen, one of the last major Western lenders in Russia, is delaying its withdrawal despite pressure from EU regulators, Reuters reported on Thursday. The agency quoted officials in Vienna as defending long-standing ties with Moscow.

Raiffeisen is viewed as playing an important role in the Russian economy, providing a lifeline for euro payments to and from the country. It is one of only two foreign banks on the Russian central bank’s list of 13 systemically important credit institutions, the other being Italy’s UniCredit.

The Austrian lender announced in March its plans to spin off its Russian business by September, following mounting pressure from Western authorities.

The RBI Group, which owns the bank, has been resisting demands from the US and EU to speed up its Russia exit, while Austrian officials have expressed hope of reviving relations with Moscow after the conflict in Ukraine ends, according to Reuters.

“Although Austria publicly supports Ukraine, several officials who spoke to Reuters said they were reluctant to completely sever decades-old ties with Russia, thinking it will still be possible to restore relations,” the outlet wrote.

Austria’s second-biggest credit institution has been under growing pressure from Western officials and investors in recent months. The European Central Bank (ECB) has reportedly urged the lender to quit the Russian market, while the RBI Group has faced scrutiny in the US and EU over potential breaches of Western sanctions.

Under pressure from Washington, Raiffeisen has transferred data on Russian transactions to the US’ sanctions authority, the Treasury Department’s Office of Foreign Assets Control (OFAC), Reuters reported, citing sources.

ECB pressures EU banks to speed up Russia exit ECB pressures EU banks to speed up Russia exit

However, Austrian officials have claimed that the bank has been unfairly singled out, the news agency said, citing people familiar with the matter. A spokesperson for the Austrian Finance Ministry reportedly stated that other EU banks were also active in Russia.

“A bank cannot leave a country like that overnight,” he was quoted as saying.

RBI has not yet outlined its plans to the ECB, making an exit from Russia unlikely by September, according to Reuters.

“RBI’s presence underlines the depth of relations between Austria and Russia, which maintain close ties through Russian gas pipelines and finance, with Vienna a hub for cash from Russia and its former Soviet neighbors,” the outlet noted.

Raiffeisen earlier warned that the decision to exit its highly profitable business in Russia would lead to “a decline in income generated by Raiffeisen Bank Russia” and impact RBI’s customers.

Senior Raiffeisen executives previously stressed that any spin-off would take four to seven months.

RBI has around 2,600 corporate customers, 4 million local account holders, and 10,000 staff in Russia.

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