Russian VTB pulls out of RCB as sanctions bite

RCB Bank announced a change in its shareholding structure, as major stakeholders VTB Bank sold a 46.29% stake to shield its assets from UK sanctions following Russia’s invasion of Ukraine.

VTB’s share capital in Cyprus RCB has been sold to Cypriot shareholders who represent the management. As a result, the bank is now Cyprus-owned.

Subject to the regulators’ consent, the shareholding structure of RCB Bank comprises only of private Cypriot shareholders from the management of the bank.

VTB is Russia’s second-largest bank with assets totalling €184 bln and 95,000 employees.

Following its invasion of Ukraine, the UK government approved sanctions that banned Russia’s economically vital industries and companies from raising finance on the UK’s money markets.

They will also stop Russian banks and state- and privately-owned companies from borrowing billions of pounds from UK lenders.

The UK introduced its toughest export controls against Russia alongside the financial measures, hitting its electronics, telecoms, and aerospace companies.

And Russia’s flagship airline Aeroflot will be banned from the UK airspace.

Under new banking restrictions, all Russians will be banned from having significant savings in UK bank accounts.

Announcing UK’s sanctions, Foreign Secretary Liz Truss named 120 businesses and oligarchs as part of a concerted strike against the Putin regime carefully coordinated with our international allies, including the US, the EU, and other G7 partners.

VTB was one of the businesses mentioned by Truss, along with weapon manufacturers such as Rostec, Russia’s biggest defence company which exports more than £10 bln of arms a year.

After Biden announced tough sanctions later on Thursday, Washington imposed sanctions on VTB.

RCB Bank was founded in 1995 and is now one of the largest financial institutions in Cyprus.

The bank’s network includes branches in Nicosia, Limassol, Larnaca, Paphos and Luxembourg.