Russian lender Sberbank announced on Friday it is closing its investment arm in London.
The UK Financial Conduct Authority, stated that the bank is “operationally unable to make payments” as a result of the sanction imposed on Russia after its invasion of Ukraine.
Sberbank said in a statement:
Sberbank is ceasing the operation of its London office, Sberbank CIB (UK) Limited. We are in contact with the local regulator, the FCA, and in accordance with the law we will close our activities, fulfilling all obligations to our clients.
The UK regulator has appointed David Philip Soden, Robert Scott Fishman and Matthew Steven Roe, all of Teneo Financial Advisory Limited, as joint special administrators of Sberbank CIB. The special administration is a form of creditor protection that often precedes bankruptcy.
The FCA said in a statement that the sanctions have led Sberbank’s investment arm to become “operationally unable to make payments despite the firm having sufficient assets to cover its liabilities.”
The FCA stated:
Having considered the firm’s position, the directors concluded that the firm is insolvent and applied to court to place the firm into special administration.
Earlier in March, Sberbank announced it is leaving European market following the unprecedented sanctions.
