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Goldman Sachs becomes the first major Wall Street bank to leave Russia

Goldman Sachs becomes the first major Wall Street bank to leave Russia

March 10 (Reuters) – Goldman Sachs Group (GS.N) On Thursday, it said it would close its operations in Russia, becoming the first major Wall Street bank to exit the country after Moscow’s invasion of Ukraine.

Business in Moscow has become increasingly difficult for Western financial institutions amid international sanctions against Russia, and banks have been weighing whether to stay or leave. While European banks have the most exposure to the country, US banks still have significant exposure, totaling $14.7 billion according to BIS data. Read more

“Goldman Sachs is terminating its business in Russia in compliance with regulatory and licensing requirements,” the bank said in an emailed statement.

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A source familiar with the situation said Goldman would end operations rather than exit immediately. The source said that the loss due to the exit will not be significant.

In its annual filing earlier, the bank disclosed its credit exposure to Russia of $650 million.

Shares of Goldman Sachs fell 1.5 percent to $328.58 in early trading. As of the close of trading on Wednesday, GS had fallen 12.8% this year.

The largest exposed US bank is Citigroup Inc (CN), which said on Wednesday it was running its Russian consumer business on a more limited basis while sticking to its earlier plans to pull the franchise. Read more

Other US banks operating in Russia include JPMorgan (JPM.N)She declined to comment on what her plans were.

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In Europe, Austria’s Raiffeisen Bank International (RBI) is considering leaving Russia, two people familiar with the matter previously told Reuters.

But experts said banks would find it difficult to extricate themselves from the market.

Dan Ury, a Cornell Law School professor who specializes in financial regulation, said last week that banks “can’t just unilaterally get away with lending commitments and other types of financial claims” because “there’s someone on the other side and that’s going to make it more complicated.” Read more

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Additional reporting by Nikit Nishant in Bengaluru and Matt Skovham in New York; Additional reporting by David Henry in New York and Bansari Mayor Kamdar in Belgaluru. Writing by Megan Davis in New York; Editing by Anil de Silva and Mark Porter

Our criteria: Thomson Reuters Trust Principles.