Raiffeisen Bank International has found a way, albeit risky, to reduce the costs of withdrawing its money from Russia.
The Austrian bank announced that it has entered into an asset swap with Rasperia, a company owned by Oleg Deripaska. The bank’s Russian subsidiary will pay the oligarch just over 1.5 billion euros in exchange for his 28% stake in the Austrian construction company Strabag.
The deal appears to be a swap of money that would otherwise be stuck in Russia for valuable offshore assets that could not be used in the home country. However, approval from the Kremlin as well as Austrian regulators will be necessary, who have frozen Deripaska’s stake in Strabag after Russia began its invasion of Ukraine.
It is also noteworthy that Raiffeisen is paying an unusually high premium of 43% for its minority stake in Strabag. If the bank had wanted to withdraw 1.5 billion euros in cash from Russia, Kremlin rules would have forced it to reduce the amount by 50% and also pay a 10% tax to the Russian government.
This would reduce the value of 1.5 billion euros to about 680 million euros. Instead, it could have an asset worth 1.1 billion euros, with an implied loss of less than 30%.
