Sanctions-hit VTB, Russia’s second-largest bank, reports huge loss

Russia’s second-largest bank, VTB, reported Wednesday a huge loss amounting to $7.7 billion in 2022 after it was hit hard by Western sanctions over Moscow’s offensive in Ukraine.

VTB, which was well-connected internationally, was one of the first banks to be excluded from the SWIFT global payments system after the conflict erupted in late February 2022.

Its chief Andrei Kostin, an associate of President Vladimir Putin, was individually sanctioned by Britain and the United States.

The bank said Wednesday its losses totaled 612.6 billion rubles last year.

“In 2022 the VTB group faced unprecedented hardships and challenges,” the bank’s chief financial officer, Dmitry Pianov, said in a statement.

“We were the first target for the maximum sanctions possible, which led to significant losses,” Pianov said.

The bank had posted a net profit of 327 billion rubles in 2021.

The bank said it suffered from an “unprecedented outflow of [foreign] currencies” as well as losses related to the disposal of subsidiaries, including VTB Bank Europe.

The bank also said it was impacted by the Russian central bank’s interest rate hikes.

“Difficult external conditions forced us to take quick and clear decisions,” Pianov said.

In 2020 VTB counted 15 million clients in Russia and employed around 80,000 employees.