The United States on Tuesday imposed sanctions on Russia's Expobank, the proposed buyer of HSBC's (HSBA.L) local unit, a move that could complicate the British lender's long-awaited departure from Russia.
HSBC said in June 2022 that it had agreed to sell a 100% stake in its Russian unit, HSBC Bank (RR) LLC, to privately-owned Expobank. Moscow has steadily tightened restrictions on foreign asset sales since then, with banks requiring President Vladimir Putin's approval for any deal.
The U.S. Treasury said it was imposing sanctions on Expobank "for operating or having operated in the financial services sector of the Russian Federation economy."
The Treasury said its Office of Foreign Assets Control (OFAC) was targeting financial institutions in Russia to limit Russia's connections with the international financial system, steps it has been taking since Moscow sent troops into Ukraine in February 2022.
Expobank said the sanctions would not affect its operations.
"We have had time to prepare and take all actions for the comfortable and convenient work of our clients," the bank said. It said all cards issued in Russia would continue working, including those issued by Visa and Mastercard.
Asked how the sanctions on Expobank might affect HSBC's exit plans from Russia, the U.S. Treasury declined to comment. HSBC had no immediate comment.
HSBC earlier this year said it had taken a $300 million loss on the expected sale of its Russian business. Moscow demands discounts of at least 50% on foreign asset sales and Western banks have found it particularly difficult to cut ties with Russia, even as they reduce exposure.
Italian lender Intesa Sanpaolo (ISP.MI) secured Putin's approval in late September, but HSBC was still waiting for the green light to sell, in a deal that sanctions may now have wrecked.
The impact of Expobank sanctions on the HSBC deal is unclear. OFAC sanctions generally bar Americans from dealing with the sanctioned party and freeze any of its U.S. assets.
