Russian court sides with Sberbank in debt recovery from ex-UK investment arm

MOSCOW (Reuters) - A Moscow court has sided with dominant Russian lender Sberbank in the bank's efforts to recover loans totalling around $138.6 million from its former British subsidiary, court filings showed on Monday.

Sberbank said it was winding down operations at its investment arm in London, Sberbank CIB (UK) Limited, in April 2022, soon after being sanctioned as part of the Western response to Moscow's role in the conflict in Ukraine.

The British regulator, the Financial Conduct Authority, said sanctions had left Sberbank CIB unable to make payments despite having sufficient assets to cover its liabilities and that it was being declared insolvent and placed into special administration.

The Moscow Arbitration Court satisfied Sberbank's claim in full, court filings showed on Monday. Sberbank had been seeking the repayment of loans in four different currencies - 28.3 million euros ($30.36 million), 3.2 million pounds ($4.05 million), 3.4 million Canadian dollars ($2.49 million) and 8.8 billion roubles ($101.73 million) - totalling around $138.6 million.

Sberbank CIB has around $105 million of cash held in various bank accounts with Sberbank or held as collateral at Russia's National Settlement Depository (NSD), Sberbank CIB's UK administrators said in a progress report published in April.

The proceedings in commercial courts in Russia concern the repayment of certain loans owed by the company, Teneo, the administrators, said in that report.

"In the event those proceedings are successful...it is unclear...whether judgement in favour of (Sberbank) would enable it to take control of (Sberbank CIB)'s cash in Russia in lieu of the intercompany debts owed," Teneo said.

Teneo did not immediately respond to a request for comment on Monday.

($1 = 0.9322 euros)

($1 = 0.7896 pounds)

($1 = 1.3674 Canadian dollars)

($1 = 86.5000 roubles)

(Reporting by Elena Fabrichnaya in Moscow and Alexander Marrow in London)