Between March 2022 and March 2023, foreign investors made about 200 transactions to sell their Russian assets. This is stated in the materials of the Central Bank.
The regulator pointed out that 20% of such transactions were associated with the exit of non-residents from large assets, each of which was estimated at more than $100 million. According to the Central Bank, since October last year, there have been five transactions with an average check above $400 million.
Recall that after the start of the SVO and the imposition of Western sanctions, many foreign companies announced their intention to curtail business in Russia, sell assets or stop investing. According to Bloomberg estimates, in 2022, foreign companies that left the Russian market sold assets worth $15-20 billion. AK&M estimated the volume of such sales at $16.31 billion last year.
As indicated in the materials of the Central Bank, the Russians felt the departure from the domestic market of large foreign companies from the catering sector, as well as retail trade in clothing, furniture and household goods. It also had a negative impact on the commercial real estate market.
According to the regulator, transactions by non-residents for the sale of Russian assets have increased risks. First, the change of ownership in some cases leads to “a complete restructuring of the business model of the acquired company.” In addition, the sale of assets by foreigners increases the debt burden of the corporate sector. Also, the Bank of Russia notes, settlements with non-residents put pressure on the foreign exchange market.
According to the review of the regulator, so far this factor has not been a key one, but this year its influence may increase.
The Bank of Russia pays “special attention” to controlling the risks associated with volatility in the foreign exchange market as a result of exit transactions by non-residents.
“Buyers are advised to evenly distribute the purchase of foreign currency in the domestic foreign exchange market,” the regulator said in a review.
Source: Rosbalt
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