Factbox-UniCredit's bank in Russia and the ECB's demands

By Valentina Za

MILAN (Reuters) - Italian bank UniCredit has filed a claim at the European Union's General Court (EUGC) over requests from the European Central Bank that the lender cut back its business in Russia.

Euro zone lenders can turn to the Luxembourg-based court to void decisions by the industry's supervisors.

UniCredit said on Monday the bank is asking the court to confirm that obligations set by the ECB are consistent with EU laws that enforce sanctions on Russia as well as Russian laws.

In the meantime, UniCredit is seeking a suspension of the ECB's requests pending the court ruling. In 2023, it took the court an average of around 20 months to close a case, according to its website.

With 56 branches at the end of last year and a full-time staff of about 3,150 people, AO UniCredit is Russia's 15th largest lender by assets, based on a ranking from April 2024 compiled by Interfax.

Below is a summary of AO UniCredit's key details:

PROFIT*

Higher interest rates have boosted AO UniCredit's income from lending after Russia's invasion of Ukraine in February 2022, despite a halving in customer loans to 3.2 billion euros ($3.43 billion) at the end of last year. Rising net fees have also helped.

* Figures in million euros

2023 2022 2021

Gross 955 974 335

Operating

Profit

Loan Loss -5 -882 -39

Provisions

Stated Net 665 -200 210

Profit

Return on 21.7% -14.3% 12.8%

Allocated

Capital

DIVIDENDS

2023 - AO UniCredit Bank contributed 137 million euros in dividends last year out of a total of 3 billion euros UniCredit paid out to investors.

Following a 2022 Russian presidential decree, companies operating in the country need a green light from a governmental commission for the control of foreign investments to pocket dividend payments of more than 10 million roubles, which are initially deposited into a special account.

EXPOSURE

UniCredit has reduced its cross-border exposure to Russia by 91% since February 2022 and its local exposure by 65%, it said on Monday.

In presenting first-quarter earnings in May, it said it had cut both local staff and branches by around one fifth from the first quarter of 2022.

However, the value of its local participation in Russia, which UniCredit defines as including both equity capital and earnings, stood at 2.8 billion euros at the end of March versus 3.5 billion euros in early 2022.

OTHER CLAIMS AGAINST THE ECB

Euro zone lenders often challenge decisions taken by the ECB by turning to the EUGC, a division of the European Court of Justice. Many cases relate to banks' annual contribution to the Single Resolution Fund.

However, for example, in February Deutsche Bank and BHW Bausparkasse asked the court to scrap an ECB decision from the previous December forcing the banks to deduct from their best-quality capital some irrevocable payment commitments.

"The number of cases in the field of economic and monetary policy, which includes inter alia banking law, continues to rise every year, with 56 new cases brought in 2023," the EUGC said on its website.

($1 = 0.9321 euros)

(Additional reporting by Tom Sims in Frankfurt; Editing by Jan Harvey)