JPMorgan Chase, Goldman Sachs, and JPMorgan Chase have ended their Russian Federation operations. This is despite the fact that western sanctions continue to grow against Moscow for its recent decision to invade Ukraine militarily. It was supported by top financial institutions.
JPMorgan and Goldman Sachs scale down Russian operations
JPMorgan Chase, Goldman Sachs Group, and JPMorgan Chase are the American banks that have announced their intention to leave Russia. Experts estimate this process could take many months to complete. They made their decisions after unprecedented sanctions were imposed on Moscow for its attack on Ukraine.
Financial restrictions made it difficult for Russian Federation banks to do business. According to the Bank of International Settlements data, U.S. banks also have significant Russian exposure.
In a statement, Goldman Sachs said it’s acting in compliance with regulatory and licensing requirements. According to a source, the bank is not exiting its current operations immediately but rather winding down. Goldman’s credit exposure to Russia amounts to $650 million. In Wednesday’s midday trades, Goldman shares declined 2.8% and fell to $325.97
“In compliance with directives by governments around the world, we have been actively unwinding Russian business and have not been pursuing any new business in Russia,” JPMorgan said in its statement. The bank elaborated that its current activities are limited while it’s helping global clients close out pre-existing obligations, manage Russian-related risk, and act as a custodian to clients.
Citigroup announced that its Russian consumer operations are limited, and it is now implementing plans to sell the franchise. Citigroup has the largest Russian exposure in the United States, with almost $10 Billion. It already admits through a financial executive to having lost nearly half its total.
Refinitiv data, which was used in the report said that Goldman Sachs had generated $19.5million in investment banking revenue in 2021. With $32.8 million, JPMorgan was second only to Russia’s VTB Capital. Citigroup generated $22.8 Million.
Russia was targeted by growing sanctions for its involvement in the conflict in Ukraine. This has limited Russia’s access to crypto assets and the global financial system. Many Russian banks were removed from SWIFT, the interbank messaging system. Revolut and Western Union have been unable to provide payment or remittance services. Visa and Mastercard have also stopped operations.
Are you expecting more international banks to leave the Russian market in the future? Leave a comment below.
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