Russian President Vladimir Putin authorized Italian banking group UniCredit to reorganize its Russian division and subsequently sell part of the business. The decision removes one of the key regulatory obstacles to the restructuring of the bank's activities in Russia.
The approval is necessary due to restrictions introduced by Moscow on transactions with assets owned by investors from countries designated by Russia as “hostile“. Since the start of the war in Ukraine, the sale of shares in certain Russian banks by foreign owners requires special permission.
UniCredit remains one of the large Western banking groups operating in the Russian market, along with Austria's Raiffeisen and Hungary's OTP. European regulators are putting pressure on Western banks to limit their exposure to Russia.
The business will be split in two
UniCredit announced back in May 2026 that it had signed a non-binding agreement to sell part of its Russian business to an established private investor from the United Arab Emirates. The name of the potential buyer was not disclosed.
The envisaged structure is more complex than a standard sale of a bank.
Some of the activities of the Russian division are to be separated into a new legal entity. After the restructuring is completed, UniCredit will retain 100% of the new bank, while the UAE investor must acquire the rest of the business. The division retained by UniCredit will focus primarily on international payments in euros and dollars for Western and Russian corporate clients that are not subject to sanctions. This is an important detail from a B2B perspective. Instead of completely ceasing operations, the strategy allows the group to maintain a limited infrastructure for cross-border corporate payments.
The exit will cost billions
The restructuring has a significant financial cost for the Italian group.
According to UniCredit's own assessment, the transaction is expected to lead to a cumulative negative effect on profit and loss of around 3-3.3 billion euros. Of this amount, approximately 1.6-1.8 billion euros are related to existing foreign exchange reserves and represent a non-cash accounting effect.
At the same time, the bank expects the operation to ultimately bring an equity benefit of around 35 basis points, as it will significantly reduce the residual risk associated with the Russian business.
This highlights the dilemma facing large Western financial institutions remaining in the Russian market: leaving could lead to serious one-off financial losses, but continuing to operate carries regulatory, sanction and geopolitical risks.
The deal is expected in 2027.
UniCredit had planned to close the operation in the first half of 2027,but the process remains dependent on the signing of final binding documentation, the actual separation of the business and the necessary regulatory approvals.
The Russian Central Bank also plays a role in the exit of foreign banks from the country, while such operations are also closely monitored by Western authorities due to the current sanctions regime.
The case of another Italian bank - Intesa Sanpaolo, which received a similar presidential permit back in September 2023, but according to Reuters has not yet completely severed its ties with Russia.