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Russia's VTB says Bank of England withdraws many demands over its UK business
June 19, 2014 / 4:52 PM / in 3 years

Russia's VTB says Bank of England withdraws many demands over its UK business

MOSCOW, June 19 (Reuters) - Russia’s No. 2 bank VTB said on Thursday that the Bank of England had withdrawn many demands it had made on VTB’s British business and that discussions to end an ongoing dispute were constructive.

VTB said in April that the British central bank had made “unjust” demands related to capital and liquidity on VTB’s British subsidiary, which is active in investment banking.

“The majority of the demands have been withdrawn, and we are on a path to the withdrawal of the remaining ones,” VTB’s chief financial officer Herbert Moos said at the bank’s annual shareholder meeting.

Andrei Kostin, VTB’s chief executive, said at the time that the Bank of England’s demands could be politically motivated in the light of the West’s standoff with Russia over the Ukraine crisis.

Britain has taken a hard line on banks generally after a string of taxpayer-funded bailouts during the financial crisis. As a result, foreign banks are under pressure to hold adequate amounts of capital and liquidity in Britain to avoid taxpayers having to step in if they go bust.

On Thursday, Moos told shareholders the Bank of England had softened its stance after the election in May of Ukrainian President Petro Poroshenko, which Russia recognised, and that talks between the two were now “constructive.”

The Bank of England declined comment. (Reporting by Alexander Winning and Oksana Kobzeva in Moscow and David Milliken in London; Editing by Elaine Hardcastle)

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