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ByHazel R. Lang

Mar 14, 2022

FRANKFURT/LONDON/ZURICH: Deutsche Bank has backtracked and said it will withdraw completely from Russia as the London Stock Exchange suspends all services in the country as Western governments impose sanctions following the invasion from Ukraine.

Deutsche, which had come under scathing criticism from some investors and politicians for its continued ties to Russia, said late Friday it would wind down operations there.

The surprise move puts the German lender alongside major US banks Goldman Sachs and JPMorgan Chase, which left Russia after the Feb. 24 invasion, and will add pressure on rivals to sever ties.

Deutsche had argued that it should support multinational companies doing business in Russia.

But on Friday evening in Frankfurt, the bank abruptly backtracked.

“We are in the process of winding down our remaining operations in Russia while we help our non-Russian multinational customers scale down their operations,” Deutsche said.

“There will be no new business in Russia.”

Insurer Zurich is no longer taking on new customers in Russia and will not renew existing business, a spokesman told Reuters on Monday.

Asset managers also said they would not make new investments in Russia and many Russia-focused funds froze due to inability to trade in the wake of Western sanctions and countermeasures by the EU. Russia.

Diplomatic efforts to end the war were gearing up on Monday, with Ukrainian and Russian negotiators due to speak again after both sides spoke of progress, even though Russia attacked a base near the Polish border and fighting continued. rage elsewhere.

Russia calls its actions in Ukraine a “special operation”.

Britain’s London Stock Exchange announced on Friday night that it was suspending all products and services for all customers in Russia, days after suspending the distribution of news and commentary in the country following new laws from Moscow.

“LSEG confirms that it is suspending all products and services for all customers in Russia, subject to any regulatory requirements,” the company said in a statement.

“We continue to support our employees in the region. We also engage with our customers outside of Russia who depend on us for data and pricing information inside Russia. We are evaluating alternative options to continue providing these services.

Index provider FTSE Russell said on Monday it would remove four UK-listed, Russia-focused companies, including Roman Abramovich’s Evraz, after numerous brokers refused to trade their shares.

Evraz along with Polymetal International, Petropavlovsk and Raven Property Group would be removed from all FTSE indices during the March review, it said in a statement.

FTSE Russell said it had received comments from its external advisory boards and market participants that trading in the shares was “severely restricted” as brokers refused to deal in the securities, affecting market liquidity.

“As a result, this will prevent index trackers from replicating the continued inclusion of these names in the FTSE Russell indices,” FTSE Russell said.

JPMorgan says the majority of risks forecast for European banks from the Russian shock will come from contagion effects on commodities and the economy, with the sector having fallen 16% since late February.

European bank stocks are at their lowest, however, and rose 2.9% on Monday.

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