The European subsidiary of VTB (VTBR.MM), Russia’s second-largest bank, is changing its name after its parent refused to allow it to operate under the brand, an executive told Reuters.
Frankfurt-based VTB Bank (Europe) SE, 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, its chief executive officer.
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.
VTB in Russia said it had been banned from exercising shareholder rights since Germany’s “illegally establishing control” over its European arm in April 2022.
“In this situation we found it impossible to satisfy VTB Europe’s request to give them the right to continue using the VTB logo and brand,” VTB told Reuters. “A third-party financial organisation, over whose activities we have no responsibility, has no right to use VTB Bank’s name and reputation.”
The new name OWH stems from a previous iteration of the lender, Ost-West Handeslbank.
The liquidation process is likely to continue for some years, but the bank has reached an important milestone, said Miro Zadro, its chief financial officer.
The Direktbank division that served retail savers has closed with its last customer having used VTB for a deposit on a garden shed.