(Bloomberg) -- Russia’s second-largest bank VTB Bank PJSC is laying off London staff after it was sanctioned following the invasion of Ukraine, according to people familiar with the matter.
The firm is effectively shutting down the London unit of VTB Capital, the people said, asking not to be identified discussing private matters. There was a substantial round of layoffs last week, while some staff are being kept on as caretakers while the bank winds down in the U.K. capital, two of the people said.
One of the people added that it’s unclear whether there will be severance payments, adding that U.K. regulators are examining the bank’s books.
VTB Capital is the investment banking division of VTB, which was hit by full blocking sanctions from the U.S. after Russian President Vladimir Putin invaded Ukraine. The U.K. froze VTB’s assets on Feb. 24, although it subsequently granted other lenders more time to cut ties.
A spokeswoman for the bank confirmed that VTB Capital is proceeding with an orderly wind-down of its positions and obligations, and had let go of some staff last week. The U.K.’s Office of Financial Sanctions Implementation issued a license earlier this month allowing the bank to pay remaining staff through March 1, 2023, the spokeswoman said.
Paul Martin, an executive director at VTB Capital, said on LinkedIn that he was actively considering new opportunities. George Niedringhaus, head of syndicate at VTB Capital, posted that his employer was closing.
The commodities-trading arm of Russia’s VTB Group told its staff in Switzerland that the majority of them would lose their jobs, according to people with knowledge of the matter, Bloomberg News reported on March 10.
VTB’s presence in London has been shrinking for years, as the bank shifted more of its operations to Frankfurt and Zug. Accounts filed in the U.K. show that assets in its London-based subsidiary VTB Capital Plc peaked in 2014 at $11.6 billion and shrank to $1.66 billion by 2020, while staff numbers fell from about 400 to about 150.
©2022 Bloomberg L.P.
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