Outside Source
As a result of the economic sanctions against Russia, the largest financial institution in the country – Sberbank – will reportedly withdraw from the European market. The organization said its subsidiaries spread around Europe face large cash outflows while the safety of its employees is threatened.
Interestingly, Sberbank is one of the Russian banks that have displayed a pro-crypto stance over the past several months.
Cutting Russia’s Financial Connections
Russia’s economy seems to be taking a serious hit following the Western world’s monetary penalties imposed on it. The cutoff from the global payment system SWIFT, among other financial bans, caused a significant crash of the ruble. The measures also started affecting giant banks like Sberbank.
According to a recent Reuters report, the institution will no longer supply liquidity to its European subdivisions. However, Sberbank asserted it has sufficient capital and asset quality to pay all depositors.
“In the current situation, Sberbank has decided to leave the European market. The group’s subsidiary banks have faced abnormal cash outflows and threats to the safety of its employees and branches,” the bank stated.
Earlier this week, the ECB ordered the closure of Sberbank’s European arm, warning it faced failure due to a run on deposits after Russia invaded Ukraine.
The bank has spread its operations to Austria, Germany, Croatia, Hungary, and other nations. Meanwhile, it has European assets worth over $14 billion.
Nonetheless, Switzerland (which is not part of the European Union) will not exclude Sberbank’s operations on its territory.
Sberbank’s Crypto Initiatives
At the end of 2021, the leading bank created a blockchain exchange-traded fund (ETF) tracking prominent companies in the cryptocurrency industry, such as Coinbase and Galaxy Digital. This became the first such product in Russia, enabling traders to delve into the digital asset universe without purchasing, storing, or selling tokens.
The fund, called “Sber – Blockchain Economy,” trades under the ticker SBBE. It follows the eponymous index developed by the bank’s investment subsidiary SberCIB. The latter consists of entities producing hardware and software for mining cryptocurrencies and even companies that provide consulting services in the sector.
Speaking on the matter was Evgeny Zaitsev – General Director of Sberbank – who noted that direct investments in bitcoin or alternative coins are associated with high risks. As such, the product would allow people to invest not in cryptocurrencies but in companies that “ensure the development of blockchain technologies.”
This article first appeared at CryptoPotato
