Russia’s VTB in Europe changes name as it liquidates

The European subsidiary of Russia’s VTB (VTBR.MM) is changing its name after its parent refused to allow it to operate under the brand, an executive told Reuters.

The Frankfurt-based bank, already ring-fenced by regulators due to sanctions and in liquidation since last year, will from now on be known as OWH SE, said Frank Hellwig, the chief executive officer of VTB’s Europe hub.

Before Russia invaded Ukraine, VTB in Europe attracted tens of thousands of German savers with its relatively high interest rates and marketed itself as a sponsor of Frankfurt’s ice hockey team, the Lions.

But after the war began, savers withdrew their money, resulting in a bank run and prompting regulators to manage the outflow. They took control in April 2022 after sanctions were imposed and the bank was cordoned off from Russia.

VTB still officially owns the European subsidiary, and Hellwig said he contacted the bank’s Russia headquarters to get permission to continue under the name while a licensing agreement ran its course. VTB declined.

OWH originates from a previous iteration of the lender, Ost-West Handeslbank.

VTB in Russia did not immediately respond to requests for comment.

The liquidation process is likely to continue for some years, but the bank has reached an important milestone, Miro Zadro, chief financial officer, said.

The Direktbank division that served retail savers has closed with its last customer – who used VTB for a deposit for a garden shed.