Swiss financial firms close down Moscow offices

Zurich Insurance and Julius Bär are abandoning their Moscow offices. Keystone / Steffen Schmidt

Zurich Insurance Group and Julius Bär bank have announced plans to abandon their Moscow offices amid the ongoing war in Ukraine.

Zurich said on Friday that it would sell its Russian subsidiary in a management buyout. “Under its new owners, the business will operate independently under a different brand, while Zurich will no longer conduct business operations in Russia,” the insurer stated.

The business unit holds a 0.3% share of the non-life insurance market in Russia and last year earned gross premiums of around $34 million (CHF33 million), including $3 million from domestic customers.

On Thursday, Julius Bär, Switzerland’s largest pure wealth manager, said it had “initiated the wind-down of its advisory subsidiary in Moscow.” The unit has a value of CHF400,000.

The bank said that at the end of April some 1.6% of the CHF457 billion assets it manages for clients belonged to Russians who are not domiciled in Switzerland or the European Economic Area.

“Since Russia’s invasion of Ukraine, Julius Bär has not on-boarded new clients with a Russian residence and applies all relevant national and international sanctions,” the bank said.

Julius Bär added that it had a “not significant” exposure to a single digit number of sanctioned Russians mainly in the form of mortgage loans and loans backed by other collateral.

Several Swiss companies have scaled back operations in Russia or pulled out completely since the invasion of Ukraine in February. Credit Suisse bank is moving staff out of Russia while it and UBS say they are not conducting any new business in the country. However, both big banks have stopped short of declaring that they will shutter Moscow offices.

Switzerland enforces European Union sanctions and has frozen CHF6.3 billion of Russian assets plus eleven properties.