Unicredit’s exposure in Russia is notoriously significant and many experts are worried about the impact of the Ukraine crisis on the large Italian bank.
Unicredit is a large and solid institution, but the strong exposure in Russia risks putting it in serious difficulty in case of default of the country led by Vladimir Putin.
By day by day the default becomes more concrete and consequently the Unicredit management is trying to limit the damage.
A difficult exit
In November, the bank led by Orcel had begun procedures to sell 9.9% of Abh Holdingswhich connected it directly to the control of Alfa Bank, a Russian banking giant, but according to reports from Milano Finanza, the embargo on Russia would have frozen the procedure.
But this is just one of the many ties that binds Unicredit to Russia. In recent years, substantial investments have been made in the country led by Vladimir Putin and now Unicredit is rightly trying to distance itself from this country. In fact, Unicredit foresees rather dire consequences for the Russian economy in the current embargo scenario and consequently a recession and even a default are not excluded. But the problem is being able to quantify the impact of Unicredit’s exit from Russia.
Dismarking from Russia
In fact, the executives of the large Italian bank have repeatedly stressed that they want to abandon their exposure in the large Asian country but obviously with the embargo and with the serious problems that this country is going through, everything becomes more difficult. The mission obviously is to suffer the least possible impact from this crisis and according to what is reported by Milano Finanza, the executives of Unicredit argue that the worst-case scenario for the Russian abandonment would have an impact of about 7.5 billion. But we are talking about the worst case scenario because the bank is working hard through all the channels at its disposal to be able to understand how much and how to limit Russian exposure in the most sustainable way possible.
Anxiety among account holders
But Unicredit account holders are wondering if the bank is at risk. The management of Unicredit is managing the Russian crisis in an optimal way to limit the impact of both a stagflation and a default and is evaluating the most useful way to distance itself from the investments made. According to all the reports that have emerged in recent days, the solidity of Unicredit does not appear at risk and the complex measures to move away from the troubled Russian giant do not seem to put the solid group in real difficulty. It is normal that in such cases there is apprehensionbut to date it does not appear justified.
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