Russian President Vladimir Putin has approved the restructuring of UniCredit’s Russian banking subsidiary and transactions needed for the planned sale of part of the business. The decision removes a major Russian political hurdle from the Italian banking group’s strategy to significantly reduce its operations in the country.
UniCredit plans to divide its Russian subsidiary into two businesses, retaining a smaller operation focused mainly on international payments while selling the remaining activities to an unidentified private investor based in the United Arab Emirates. Completion remains targeted for the first half of 2027 and is still subject to the transaction becoming binding and securing relevant approvals.
Key Overview
- Putin has approved the reorganisation of UniCredit’s Russian banking subsidiary and related share transactions.
- The approval was necessary because of Russian restrictions affecting asset deals involving investors from countries Moscow considers “unfriendly.”
- UniCredit intends to split its Russian operation into two separate businesses.
- A UAE-based private investor is expected to acquire the majority of the remaining Russian banking activities.
- UniCredit intends to retain full ownership of a smaller business focused mainly on international payments.
- The proposed transaction remains non-binding and is targeted for completion in the first half of 2027.
- UniCredit has been progressively reducing its Russian exposure amid regulatory and sanctions pressure.
Putin Clears Major Hurdle for Russian Restructuring
Putin has approved the reorganisation and related sale process, allowing UniCredit to advance a restructuring that was first announced in May.
The presidential decision is important because Russia imposes special restrictions on transactions involving assets controlled by investors from jurisdictions it classifies as “unfriendly.” Banking transactions involving Western owners have consequently required significant government scrutiny since Russia’s invasion of Ukraine in 2022.
The restructuring involves separating activities currently housed within AO UniCredit Bank into distinct businesses. Once completed, UniCredit would maintain ownership of the newly separated operation, while the UAE-based buyer would acquire the remaining bank.
The decree therefore advances the legal groundwork for the planned transaction, although it does not mean the entire divestment has already been completed.
UniCredit Plans to Keep Its Payments Business
UniCredit originally announced the non-binding agreement in May, saying the buyer was a well-established private investor in the United Arab Emirates with longstanding links to the local institutional and business community.
The bank’s strategy is to retain a significantly smaller Russian presence centred mainly on international payments in euros and U.S. dollars for non-sanctioned Western and Russian corporate clients.
Under the proposed structure, part of AO UniCredit Bank’s activities will be transferred to a new entity. UniCredit will retain full ownership of that business, while the buyer will ultimately control the remaining operations.
The parties still need to finalise a binding agreement. UniCredit has said the transaction is expected to close during the first half of 2027, subject to the separation process and relevant regulatory authorisations.
The bank has not disclosed the value of the proposed sale.
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Years of Pressure to Reduce Russian Exposure
UniCredit was one of the largest Western banks operating in Russia when the war in Ukraine began and has faced sustained pressure to reduce its presence.
The bank previously acknowledged regulatory demands to reduce risks associated with Russia, while arguing over aspects of how quickly and under what legal conditions those reductions should occur.
By mid-2024, UniCredit said it had already reduced its cross-border exposure to Russia by 91% and domestic exposure by 65% compared with levels following the invasion.
The planned transaction with the UAE investor represents a further stage in that reduction strategy, while allowing the bank to maintain a narrower payments operation serving eligible corporate customers.
UniCredit is not alone in facing difficulties exiting Russia. Western financial institutions have had to navigate Russian approval requirements, European sanctions rules, capital controls and concerns over the treatment of assets during attempted disposals.
Sanctions Environment Continues to Shift
The transaction is unfolding alongside changes in Europe’s sanctions regime.
In July, the EU introduced a narrow exemption covering a pre-existing transaction that could allow UniCredit to resolve a separate long-running deal linked to its former Ukrainian subsidiary and Russian businessmen Mikhail Fridman and Petr Aven.
That issue dates back to a 2015 agreement under which UniCredit sold its Ukrainian subsidiary in exchange for a minority interest in ABH Holdings. Subsequent sanctions complicated UniCredit’s ability to exercise contractual rights connected to the transaction.
The broader sanctions landscape changed again in September when EU governments removed Mikhail Fridman and Alisher Usmanov from the bloc’s Russia sanctions list while renewing restrictions on thousands of other individuals and entities.
These developments do not by themselves complete UniCredit’s Russian exit, but they illustrate the unusually complex legal environment surrounding Western businesses attempting to restructure or dispose of Russian assets.
What Happens Next for UniCredit
Putin’s approval gives UniCredit greater certainty over one of the biggest Russian-side obstacles to its restructuring plan.
The next steps include completing the separation of the Russian operations, finalising binding transaction agreements with the UAE investor and obtaining any remaining relevant authorisations.
If the transaction closes as planned in the first half of 2027, UniCredit’s Russian presence would become substantially narrower, shifting away from broad retail and corporate banking towards a more limited international payments operation.
The deal would mark another significant stage in UniCredit’s multi-year effort to reduce its exposure to Russia while navigating sanctions, regulatory demands and strict Russian controls over foreign-owned assets.
Sources: Reuters / UniCredit / Interfax
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