Austrian banks unaffected by banking turmoil

ZURICH (Reuters) – Austria’s government is monitoring the global banking turmoil although there are so far no signs of it spreading to the country’s financial sector, Finance Minister Magnus Brunner said in an interview published on Saturday.

“Our banks did their homework very well after the financial crisis. They are very well prepared,” Brunner told Swiss newspaper Neue Zuercher Zeitung.

He also defended Raiffeisen Bank International (RBI) which has come under fire for continuing to operate in Russia despite the war in Ukraine.

The Austrian lender is now the most important Western bank in Russia, offering a lifeline to people and businesses there seeking to make international payments, but it is under growing pressure from Western officials and investors to quit.

In February the bank said it had received a request for information from the United States’ sanctions authority about its business related to Russia.

Last month RBI said it was considering a sale or possible spin off of the Russian business.

“As for RBI, the bank complies with all international sanctions,” Brunner told NZZ. “It is also not subject to sanctions itself,” he added.

“Incidentally, there are other European banks that continue to operate legally in Russia. It is crucial for us that all sanctions are observed,” he said.

The minister also said Austrian inflation, which fell to an estimated 9.2% in March, was still too high and called on the European Central Bank to do more to contain price increases.

“The European Central Bank (ECB) in particular can do something about this, as a member of the euro zone we are dependent on the ECB,” Brunner said.