Finance watchdog orders ‘protective measures’ at Sberbank Switzerland

Keystone / Roland Schlager

The Swiss financial regulator has ordered protective measures to mitigate a risk of “liquidity problems” at the Zurich-based subsidiary of Russian bank Sberbank.

The measures, which include a 60-day deferral of the bank’s obligations from deposits, as well as a wide-ranging ban on payments and transactions, are “to protect creditors”, the Swiss Financial Market Supervisory Authority (FINMA) said on FridayExternal link.

Although the Swiss-based bank is not part of the Sberbank Europe Group, which has been hit hard by EU and US sanctions, FINMA said that the “heightened international sanctions” nevertheless leave it “at risk of facing liquidity problems”.

Earlier this week, Sberbank Switzerland said it would continue functioning as normal even after other parts of the group pulled out of operations in the rest of Europe.

According to FINMA, the bank has now “decided not to engage in any new business until further notice and is largely restructuring and reducing its business activities”.

The supervisor has also ordered the bank may not make any payments or transactions that “are not necessary for its operations as a bank”.

FINMA would appoint an investigating agent to monitor the state of financial stability at the bank, the equal treatment of creditors, and the bank’s organisational structure, it said.

More sanctions

On Friday, the Swiss Bankers Association excluded from its ranks the Swiss subsidiaries of both Sberbank and Gazprombank. The association condemned the Russian invasion of Ukraine, and said it stood behind the sanctions decided by the Swiss government.

After following the first set of sanctions taken by the EU against Russia earlier this week, the Swiss government took further actionExternal link on Friday – including targeting some financial institutions – as part of international efforts to cut Russia from the SWIFT financial transactions system.

Sberbank Switzerland has around 250 corporate clients, mostly related to the raw materials and commodity trading sector. It employs some 100 staff and in 2020 it generated a profit of CHF58 million ($63 million).