The US Treasury Department’s Office of Foreign Assets Control (Ofac) has given the green light to TradeXBank, successor bank of Russia’s Sberbank, to resume operations in US dollars. This decision comes after Ofac removed TradeXBank’s predecessor bank, Sberbank (Schweiz) AG, from its sanctions list for Russia.
Following the Russian attack on Ukraine in February 2022, Sberbank was sanctioned by the US, leading to implications for its subsidiary bank in Switzerland. Specializing in trading raw materials like energy, agricultural products, fertilizers, and metals, the Swiss bank was eventually sold to the Geneva-based investment company m3 Groupe Holding SA, under the supervision of the Swiss Financial Market Supervisory Authority (Finma). The bank was rebranded as TradeXBank and continued to operate in European, Middle Eastern, and African markets, serving medium-sized companies in the raw materials trading sector.
Despite the sale, some US sanctions remained in place, preventing TradeXBank from conducting transactions in US dollars. This limitation forced the bank to rely on euros and Swiss francs for transactions, making it challenging for the bank and its customers. However, the bank managed to stay profitable and retain its loyal clientele despite these obstacles.
The process of getting TradeXBank off the sanctions list was a lengthy and complex one that involved cooperation with law firms in Washington to demonstrate its independence from its Russian parent. With the removal of sanctions, the bank is now able to resume operations in US dollars which is expected to boost its growth prospects significantly. The bank has retained a significant portion of its staff from its Sberbank days with a focus on serving clients in the raw materials trading industry.