Russia's largest Western bank, Raiffeisen Bank International, has set aside 840 million euros to cover fines in Russia, Reuters reported.
The decision affects Raiffeisen Bank International's financial results last year. Raiffeisen Bank International's revenue last year was already affected by the €824 million write-down on the sale of its Belarusian bank. Raiffeisen's consolidated annual profit in 2024 fell more than 50% to €1.15 billion.
The loss of nearly 1.7 billion euros highlights the risks in Raffeisen's business with Russia and former Soviet states - markets that have historically driven Raffeisen's growth.
Last month, a Russian court ruled that Raiffeisen (RBI) must pay more than 2 billion euros in compensation.
The case is seen as one of the most far-reaching legal judgments against a Western company operating in Russia, and one of the largest damages awards to date.
Although Raiffeisen learned of the incident last year, the terms of the settlement were only announced on February 4.
The legal dispute comes after Raiffeisen failed to reach a deal to release billions of dollars worth of frozen funds in Russia.
In this case, Russian investment company Rasperia filed a complaint against construction company Strabag, Strabag's Austrian shareholders and Raiffeisen's Russian branch.
Strabag is based in Vienna, Austria and is linked to Russian businessman Oleg Deripaska.
Raiffeisen is understood to be looking to buy Rasperia's stake in Strabag.
Meanwhile, the US identified Rasperia as part of a group of Russian companies controlled by Oleg Deripaska and imposed sanctions on several individuals involved.
For his part, Mr. Deripaska has always maintained that he has no connection with the company in dispute with Raiffeisen.
Raiffeisen has about 6 billion euros ($6.29 billion) in Russia, a source familiar with the matter told Reuters, drawing on international payments and billions of euros in Russian deposits.
Nearly three years after the Russia-Ukraine conflict broke out, Raiffeisen Bank remains active in Russia, a position that stems from Vienna’s longstanding role as a financial hub for Russia and the former Soviet Union.
The position also puts Raiffeisen and Austria at the forefront of the US’s global effort to isolate Russia by strengthening banking sanctions and blocking access to Western goods after the conflict in Ukraine erupted.
Raiffeisen - which includes numerous subsidiaries, has 44,000 employees and more than 18 million customers spread from Vienna to Moscow - has become a financial anchor for Austria and much of Eastern Europe, according to Reuters.
Raiffeisen has repeatedly said it wants to separate its Russian operations, but nearly three years after the conflict in Ukraine, little has changed.
