Raiffeisen Bank International (RBI) is delaying its plans to exit Russia, sources told Reuters on condition of anonymity, as Austria becomes more determined to defend its long ties with Moscow, Agerpres reports.

Raiffeisen, Austria’s second-biggest bank and Russia’s biggest western bank, had planned to spin off its Russian payments business under pressure from regulators by September, at a time when Russians have few alternatives and Moscow is increasingly isolated after the invasion of Ukraine.

Austria and Raiffeisen, which are in the sights of US authorities investigating ties between the RBI and Russia, are resisting pressure, hoping the war in Ukraine will soon end, sources told Reuters.

Austrian officials, meanwhile, are staunchly defending the RBI in Europe and Washington, saying it unfairly draws attention to the bank, sources say, hurting Western efforts to isolate Moscow, the sources say.

Raiffeisen is biding its time, waiting for the end of the war in Ukraine

Despite Austria’s declarative support for Ukraine, some officials who spoke to Reuters said they were unwilling to completely sever long-standing ties with Russia in the hope that they could be restored.

The RBI has yet to present its plans to ECB supervisors, so it is unlikely that the Russian business will be spun off before September. The sources added that the bank wants to wait for ECB approval before asking its shareholders for the green light. These steps can take months.

In addition, the RBI would need the approval of Russia’s Central Bank, the Ministry of Finance and, in the case of a sale, even President Vladimir Putin to act. In Russia, RBI has approximately 2,600 corporate clients, four million local account holders and 10,000 employees.

According to sources, the Russian authorities have expressed their desire to leave the RBI as it allows international payments. An RBI official said the institution will continue to sell or demerge and intends to reduce its business in Russia.

American and European authorities are putting pressure on the Austrian bank to leave Russia

However, the RBI’s slow pace of action is fueling differences with the ECB, which oversees the bank, as well as putting pressure on other lenders such as UniCredit to exit Russia. The Italian bank declined to comment on its plans.

The ECB has asked the RBI not to pay dividends this year due to concerns about Russia, the sources said. The RBI is also considering the sale as an alternative to unlock up to four billion euros of capital tied to the profitable Russian unit.

Austrian Central Bank Governor Robert Holtzmann expressed concern about the ECB’s pressure on the bank in a conversation with ECB President Christine Lagarde, sources said. Representatives of the Central Bank of Austria and the ECB did not want to comment on the information.

A spokesman for the Austrian Ministry of Finance said that other European banks are also active in Russia.

Austria is defending one of its biggest banks against accusations

“The bank cannot leave such a country overnight,” a finance ministry official said, criticizing what he described as claims that Austria was an exception. RBI’s presence in Russia has caused disagreements in management as well as among members of the regional banks (Landesbanks) that control the group, with some officials calling for an exit from the Russian market.

In late March, RBI chief executive Johann Strobl told shareholders that the Austrian bank would consider a possible sale or spin-off of its Russian business following initial media reports.

Raiffeisen will continue to scale back its operations in Russia while it evaluates its options, Strobl said, but will retain some operations to be able to keep its banking license.

Raiffeisen Bank International (RBI) has been operating in Russia since the collapse of the former USSR and is currently Russia’s tenth largest bank by assets. Last year, Raiffeisen posted a net profit of around 3.8 billion euros, largely due to a two billion euro increase in profits from its Russian business.

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