An arbitration court in St. Petersburg has frozen assets of several banks in Russia, including Deutsche Bank. The measure comes at the request of RusChimAllianz, a Gazprom subsidiary operating an LNG terminal in the Baltic Sea port of Ust-Luga, which is making claims against Deutsche Bank for 238.61 million euros. The Russian state news agency Tass reported this on Saturday.
The assets were blocked in the form of securities belonging to Deutsche Bank and other companies with its participation, as well as in the form of real estate and money in accounts. It is therefore only part of Deutsche Bank’s assets in Russia. The court had previously also frozen bank accounts and assets of the Italian bank Unicredit in Russia. Other donors are also affected.
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The background is the collapsed construction of the terminal on the Baltic Sea due to the western Sanctions for which the banks had helped guarantee. RusChimAllianz wants 444 million euros from Unicredit. Assets worth 463 million euros are to be frozen. Unicredit is the largest active foreign bank in Russia after Raiffeisenbank and is one of the 20 largest banks in the country based on its balance sheet assets.
Deutsche Bank said it remained to be seen how this decision would be implemented by the Russian courts and what consequences this would have for the bank’s operations in Russia. “Deutsche Bank sees itself as fully protected by a compensation agreement with a customer,” it was emphasized at the same time in Frankfurt am Main. Deutsche Bank recorded a provision of around 260 million euros and a corresponding asset from reimbursements as part of the compensation agreement.
RusChimAllianz signed a contract for the construction of the plant with the German industrial group Linde and the construction company Renaissance Heavy Industries in 2021. RusChimAllianz paid an advance to Linde for this, it was said. After the war of aggression against Ukraine launched by Kremlin chief Vladimir Putin, the West imposed sanctions. Linde has informed its client that the work has stopped. The banks that had acted as guarantors for the deal also withdrew their guarantees because of the sanctions.
In addition to Deutsche Bank and Unicredit, Commerzbank, Bayerische Landesbank and Landesbank Baden-Württemberg were also sued before the arbitration court in St. Petersburg. In contrast to Unicredit, the companies did not have large branches in Russia.
Russia is increasingly responding with retaliatory measures to sanctions imposed by Western countries because of Russia’s war of aggression against Ukraine. Numerous companies had to accept the confiscation or seizure of assets and new managers were appointed to the Russian subsidiaries. Companies that withdraw from Russia sometimes have to sell their businesses to Russian companies at significant discounts. Often only a symbolic ruble is paid.