VIENNA, July 29 Austrian lender Raiffeisen Bank
International (RBI) will concentrate more on the
retail segment in its key Russian market amid growing
competition for corporate customers, Chief Executive Karl
Sevelda told the Wirtschaftsblatt newspaper.
"Russia is an important market for us ... but we will wait
and see how the situation develops. We will keep doing business
but shift the focus from corporate to retail," he said in an
interview published on Tuesday.
Margins in the corporate business there are falling sharply
but retail margins are not, he said, adding Raiffeisen wanted to
exploit its "excellent image" in Russia, RBI's single most
As EU countries prepared to impose stepped-up sanctions on
Russia for its role in Ukraine's political crisis, Sevelda
called for a "balanced solution", noting sanctions would harm
not just Russia but also Ukraine and the European Union.
But he added: "One cannot sacrifice all ethical and moral
standards for the sake of business."
Sevelda said he met Russian President Vladimir Putin at a
lunch during his visit to Vienna last month, and said Putin had
stressed he had no intention of annexing eastern Ukraine, as it
had done with the Crimean peninsula.
"I had the impression that Putin is not ready to sacrifice
his significant, good economic ties with the European Union to
this step," he said, adding Ukraine also had an interest to find
a balanced position between the EU and Russia.
RBI put the sale of its banking unit in Ukraine on hold
during the crisis, but Sevelda said he hoped a new parliament to
be elected there later this year could restore an environment in
which the rule of law prevailed, addressing a major reason why
it had considered a sale in the first place. "So we are taking a
look at how the situation develops," he added.
RBI also called off a planned sale of its unit in Hungary
after getting an offer it deemed too low, but Sevelda said the
situation there was different than in Ukraine.
"There is peace in the country but no peace between the
government and banks," he said, referring to Budapest's efforts
to get banks to pay up for what it calls unfair lending
practices. Sevelda said the steps threatened to cause massive
harm to the entire banking system in Hungary.
(Reporting by Michael Shields; Editing by Mark Potter)