Russia's state-owned bank closing its only subsidiary in Africa due to sanctions

According to media reports, Banco VTB Africa S.A. was established in Angola in 2007. The bank has decided to surrender its banking license.

"We are closing it, withdrawing the license. This is a voluntary-compulsory surrender of the license – everything is frozen there," said the head of the bank, Andrey Kostin.

He mentioned that a meeting was held with the President of Angola, João Lourenço, during which the fate of the bank was discussed. The second-largest shareholder of Banco VTB Africa is Angola's Endiama diamond mining corporation.

Likely, an agreement on the future of Banco VTB Africa could not be reached.

VTB is facing similar problems with its branches in the UK, Germany, and post-Soviet republics.

The Russian state bank has lost control over VTB Capital and VTB Bank Europe. Additionally, its business in Georgia has been closed.

Sanctions against the owner of VTB Bank

In 2017, VTB reorganized its European subsidiary by merging its branches in Germany, Austria, and France under the single license of VTB Bank Europe. This bank was owned by VTB, but after sanctions were imposed on the Russian bank in 2022, the German regulator removed VTB from managing its European "subsidiary" and stripped it of control over the assets of VTB Bank Europe, noting that the European bank itself was not subject to EU sanctions.

In February 2023, the United States accused VTB CEO Andrey Kostin and two of his assistants of violating sanctions. Specifically, Kostin was accused of money laundering and violating restrictions related to the ownership of two yachts and a home in the resort town of Aspen, USA.

According to the US, Kostin was involved in a scheme to evade sanctions and launder money to support two superyachts valued at over $135 million.