Russian court seizes major assets from Deutsche Bank and UniCredit

A Russian court has ordered the seizure of assets worth hundreds of millions of euros from two foreign banks operating in Russia: Italian UniCredit and German Deutsche Bank. The request for this action was made by the Russian gas company RusChemAlliance, according to Russian judicial authorities on Saturday.

The arbitration court in Saint Petersburg ordered on May 16 the seizure of real estate, securities, and accounts in Russia amounting to 680 million CAD from Italy's second-largest bank, UniCredit. A similar decision was made on the same day against Deutsche Bank, Germany's largest bank. The seizure order concerns its real estate, securities, and accounts amounting to 350 million CAD.

Both decisions were made at the request of the RusChemAlliance corporation, founded by the Russian gas giant Gazprom. The corporation planned to build a large gas processing and liquefaction plant near Saint Petersburg.

After the Russian invasion of Ukraine, the corporation lost its partner—the German company Linde, which was supposed to supply equipment for the project. UniCredit and Deutsche Bank were guarantors of this venture, but due to sanctions, they could not fulfill their obligations to RusChemAlliance.

In the summer of 2023, the Russian company filed a complaint with the arbitration court in Saint Petersburg, demanding that both banks pay hundreds of millions of euros from the bank guarantees provided for in the obligations.

Deutsche Bank responded in a press release, "We will need to see how this claim is implemented by the Russian courts and assess the immediate operational impact in Russia." Meanwhile, UniCredit stated that the bank is aware of the Russian court’s decision and assured it is "thoroughly examining" the situation.

UniCredit, previously one of the most actively operating European banks in Russia, began "preliminary" talks in May 2022 regarding the possible sale of its Russian subsidiary, but the project has stalled. The Italian bank has been present in Russia since 2005.