The invasion of Ukraine by Russia could have negative repercussions on the Portuguese bank due to the sanctions imposed on the country of Vladimir Putin. Novo Banco is the most exposed through the bonds of the Russian state oil company Gazprom.
O new bank is, at present, “the only known case of national financial entities Exposure to Russian debt“, as attested by Correio da Manhã (CM), due to the investment he has in Gazprom’s obligationsone of the largest oil companies in the world which is among the companies affected by the sanctions against Russia.
In September 2021, Portuguese banks had debt investments with Russian entities of around $149 million, an amount which corresponds, at the current exchange rate, to 133 million eurosaccording to the latest data from the BIS – Bank for International Settlements (Bank for International Settlements) cited by CM.
These data will concern only Novo Banco whereas BCP, CGD, Santander Totta and BPI will not be exposed to Russian debt.
However, banking risks may still extend to government debt and debt issued by companies.
Novo Banco’s investment in Gazprom is justified by the fact that this company pays interest of around 7% per year in the issuance of bonds.
With the Russian invasion of Ukraine, Novo Banco will have attempted to sell the Gazprom bonds it holds. Nevertheless, “couldn’t find a buyer available to pay an adequate price”, concludes the CM.