Financial industry titans are joining the likes of McDonald’s and Coca-Cola in shutting down business operations in Russia as the death toll in Ukraine rises and millions of refugees flee.
Hannah Levitt and Sridhar Natarajan Bloomberg
Created March 10, 2022 March 10, 2022
JPMorgan Chase & Co. joined Goldman Sachs Group Inc. to withdraw from Russia in response to the country’s invasion of Ukraine last month.
JPMorgan, the largest US bank, currently has limited activity in the country, the New York-based company said in a statement Thursday. Goldman Sachs said it plans to close its operations there.
Financial industry titans join titans from other sectors, including McDonald’s Corp. and Coca-Cola Co., which have already said they will cease business operations in the country as the death toll in Ukraine rises and millions of refugees flee. These moves will further isolate Russia, a country of 144 million people and the 11th largest economy in the world.
“Ongoing activities are limited, including helping global clients resolve and close pre-existing liabilities; risk management related to Russia; acting as a custodian for our clients; and take care of our employees,” JPMorgan said in a statement.
JPMorgan’s direct presence in Russia is small. The country was not included among the firm’s top 20 country risks outside the US, according to a regulatory report filed last month. The bank has fewer than 100 employees in the country, according to a person familiar with the matter.
In recent years, Goldman has maintained a presence in Russia, but the country does not make up a significant part of its global banking business. At the end of 2021, the company’s total credit risk in Russia was $650 million, most of which was attributable to non-sovereign counterparties or borrowers.
“We are focused on supporting our customers around the world in managing or closing pre-existing market liabilities and ensuring the well-being of our people,” New York-based Goldman said in a statement earlier Thursday.
Goldman has already moved some of its Moscow staff to Dubai in response to requests from some Russian employees to work from another location.
Visa, Mastercard
Visa Inc. and Mastercard Inc. also suspended their activities in Russia. Each of the credit card giants receives about 4% of net income from country-related businesses.
At Citigroup Inc. It has about 3,000 employees, making it the largest presence in Russia of any major US bank. On Wednesday, the company said it was evaluating operations there. It has previously announced attempts to exit its consumer business there and is now operating it “on a more limited basis given current circumstances and obligations,” Edward Skyler, executive vice president of global communications, said in a statement.
Potential bidders for Citigroup’s retail operations in Russia are now subject to sanctions imposed by the US government, posing another hurdle to the planned sale. He stated that as of the end of 2021, he had about $9.8 billion of loans, assets and other risks associated with Russia, local companies and their counterparties, as well as with the Bank of Russia.