UBS reveals $200m exposure to Russian assets
Swiss banking group UBS has today revealed it has around $200m exposure to Russian assets and around $10m of outstanding loans to clients hit by western sanctions in response to Russia’ invasion of Ukraine.
In its annual report today, the lender said the Russian assets were used as collateral in loans to clients at its wealth unit, and a “small number” of its wealth management clients have been sanctioned in response to the’ invasion of Ukraine.
“We are working to implement sanctions imposed by Switzerland, the U.S., the EU, the UK and others,” UBS bosses said in the report.
The firm’s direct country risk exposure to Russia was $634mn at the end of 2021, it reported today, out of a total emerging market exposure of $20.9bn.
Swiss banking’s secrecy and the country’s longstanding commitment to neutrality have made it a magnet for oligarch money. But the Swiss government’s move to fall in line with EU sanctions has made it a less attractive place for Russians to store their cash.
Bosses at UBS said they were also currently monitoring settlement risk on certain open transactions with Russian banks and non-bank counterparties or Russian underlyings, as well as market closures, the imposition of exchange controls and sanctions.
Western sanctions have shaken the Russian economy and caused the value of the rouble to plunge in the past week, while the Moscow stock exchange remains shuttered as the Russian Central Bank fears an investor exodus on opening.
The exchange is slated to resume trading on Wednesday.