June 8, 2013 / 2:21 PM / 5 years ago

Raiffeisen reviews compliance after Stepic affair

VIENNA, June 8 (Reuters) - Raiffeisen Bank International will tighten up its compliance rules after its chief executive resigned over offshore property deals, the bank’s chairman said.

Herbert Stepic quit suddenly last month after it was revealed he had used mailbox firms in the British Virgin Islands and Hong Kong to buy apartments in Singapore. His departure exposed divisions at the banking group.

RBI Chairman Walter Rothensteiner said Stepic’s conduct was not in accordance with current thinking in the banking sector, but said Raiffeisen had not had clear rules about how executives should conduct their private business.

“It was neither necessary nor usual to give instructions in such matters to colleagues with whom one had worked closely for 30 years. That will now change,” Rothensteiner told Profil magazine in an interview published online on Saturday.

Rothensteiner said the supervisory board had not known of the scale of Stepic’s foreign property investments until News magazine revealed them. He reiterated that Stepic had resigned of his own free will.

Stepic, 66, has denied any wrongdoing and says he decided to quit to spare the bank a damaging debate about his personal investments. (Reporting by Georgina Prodhan, editing by Gareth Jones)

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