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Monday, December 11, 2017

Volksbanken hit with Sberbank suit

Sberbank, the largest bank in Russia and Eastern Europe, recently filed a lawsuit against the partially state-owned Austrian lender Volksbanken in a dispute over the value of Volksbanken International, which the Russian bank bought last year.

Sberbank paid $687 million for VBI's Eastern European business, but has since reportedly complained about the quality of the assets it purchased.
Sberbank signed the deal after receiving a $109 million discount off the originally agreed price, giving Russia's top bank a higher profile in emerging Europe, The Moscow Times reports.

"Sberbank of Russia brought an action against VBAG at the International Court of Arbitration in November. Based on the claims put forward in the action and following an internal analysis of the accusations contained therein, no indemnification losses can currently be identified," VBAG said in its third-quarter financial report, according to The Moscow Times.

VBAG is also undertaking a major downsizing ordered by the European Commission as a condition for approving state support received by the bank in the wake of the financial crisis.

Austria took a 43 percent stake in VBAG last year as part of a rescue that cost taxpayers more than $1.37 billion in write-downs on previous aid, fresh capital and guarantees.

VBAG said on Thursday that its restructuring would keep it in the red until at least the end of 2015.