The financial organization announced, this Wednesday, April 5, a deadweight loss of 612.6 billion rubles, or around 7 billion euros at the current rate in 2022, in a context of international sanctions against Russian finance.

Sanctions do not leave Russian finance unscathed. VTB, the second Russian bank, announced this Wednesday, April 5 a loss of 612.6 billion rubles, or around 7 billion euros at the current rate, in 2022. As a reminder VTB, which claimed 15 million customers in Russia in 2020 and employs nearly 80,000 people, had posted a profit of 327.4 billion rubles (about 4 billion euros) in 2021.

This deficit in VTB’s accounts is due to the “unprecedented” sanctions which have affected it in retaliation for the Russian offensive in Ukraine, in particular its exclusion from the Swift international payment system. “In 2022, the VTB Group faced unprecedented difficulties and challenges. (…) We have become the first target of the maximum possible sanctions, which has led to significant losses, ”lamented Dmitri Pianov, financial director of VTB, quoted in a press release from the group.

İnternational sanctions targeting the Russian banking sector have hit VTB hard, in which the Russian state is the majority shareholder, and which is particularly present on foreign markets. In March 2022, a few days after the start of the Russian military intervention in Ukraine, the European Union notably excluded VTB from the Swift international payment system. His indestructible boss, Andreï Kostine, in office since 2002, is sanctioned individually, in particular by the United Kingdom and the United States.

“In 2022, VTB Group became the first of Russia’s largest banking institutions to be affected by the most stringent measures,” the bank said in its statement. VTB notably listed “the unprecedented outflow of cash in foreign currencies, the losses linked to the sale of subsidiaries” (including the one it had on the European market, VTB Bank Europe), as well as the increase in the interest rate by the Russian Central Bank, as the main reasons for the group’s difficulties. “Difficult external conditions forced us to take quick and clear decisions,” said Dmitri Pianov on Wednesday. The group notably announced the acquisition of the Otkrytie bank in December 2022.

While Western sanctions have hurt internationally-oriented Russian businesses, the Russian economy has not collapsed. According to a report by the International Monetary Fund (IMF), published on 31st January, Russia certainly fell into recession last year but the fall in GDP is relatively modest (-2.2%), far from the IMF forecasts made in spring 2022 which anticipated an 8.5% drop in Russian GDP in 2022.

Above all, the Russian economy should not fall any lower and pick up again with a slight increase of 0.3% in 2023 (i.e. slightly below the growth outlook for the euro zone established at +0.7% in 2023) then an increase of 2.3% in 2024. Growth which would then be better than that of the euro zone which will only rise by 1.6% according to the IMF.