Russian retail investors ask VTB to compensate them for foreign losses

MOSCOW, July 22 (Reuters) – A handful of dozen Russian retail traders handed in a letter to the country’s 2nd-biggest financial institution VTB (VTBR.MM) on Friday inquiring for payment for losses designed on their international investments following Western sanctions have been imposed before this yr.

In the letter, they stated VTB – amid the first Russian entities sanctioned after Moscow despatched troops into Ukraine on Feb. 24 – closed operations for retail investors as well rapidly and so deprived them of a opportunity to offer their now-frozen property.

They claimed VTB blocked retail consumers from selling international shares on March 3, 13 times prior to Euroclear, just one of two huge Western clearing properties, suspended operations with its Russian counterpart, the Nationwide Settlement Depository, on March 16.

The letter, observed by Reuters, asked VTB to reimburse the retail buyers at SPB Trade, the most important investing system for overseas stocks in Russia, for the March 3 price of their holdings and said they would take authorized motion if the point out-owned lender declines. It did not say how considerably cash the retail buyers ended up proclaiming.

VTB declined to comment when contacted by Reuters.

Reuters could not independently confirm that VTB experienced halted share investing for retail consumers on March 3. The Countrywide Settlement Depository issued a observe on its web site on March 17 saying Euroclear had suspended functions with it.

The United States put comprehensive blocking sanctions on VTB, which accounts for 1-fifth of Russian banking belongings, on the day Moscow began what it phone calls a exclusive military operation in Ukraine, severing the bank’s ties with Western counterparts.

According to VTB, it held about 2.6 trillion roubles ($47 billion) of retail investors’ property very last 12 months.

Russia’s central bank says sanctions have stopped some 5 million Russians from accessing shares they possess in foreign firms, with a complete worth of over 320 billion roubles.

Igor Deryabin, a 25-12 months-previous Muscovite, and his spouse Darya, were being among all those protesting at VTB’s headquarters in Moscow’s monetary district on Friday.

“We have been getting the most secure shares hoping for price tag boost and dividends,” Igor instructed Reuters. “We wished to build a more substantial capital for more substantial buys, to get a flat.”

He mentioned his family experienced shed obtain to shares worth in excess of 1 million roubles in two dozen overseas companies which include IBM and Shell . The common month-to-month wage in Russia is 67,000 roubles.

The couple have been between much more than 450,000 men and women that VTB claimed used its application to handle their inventory holdings.

Curiosity in inventory market place investments boomed in Russia during coronavirus lockdowns two decades in the past. As of past calendar year, 17 million Russians – about just one in five individuals – held approximately 8 trillion roubles in brokerage accounts, in accordance to the central lender.

Moscow has retaliated for Western sanctions by blocking foreign investors’ entry to Russian securities, such as shares and rouble bonds, ending several years in which money experienced flowed into Russia’s stock marketplace and economy.

($1 = 55.3750 roubles)

Reporting by Reuters

Our Requirements: The Thomson Reuters Believe in Principles.