The Russian National Reinsurance Co., owned by the country's central bank, helped insurer Ingosstrakh Insurance Co. Ltd. to reinsure risks of companies owned by businessman Oleg Deripaska, who was recently hit by U.S. sanctions, Vedomosti reported May 23.
Deripaska and his companies, including United Co. Rusal PLC and En+ Group PLC, were added to the U.S. Treasury Department's sanctions list in April, Vedomosti said. After the introduction of the sanctions, Ingosstrakh, which insures property risks of Deripaska's companies, approached the Russian National Reinsurance Co. to reinsure the risks, fearing that Western companies, in which the risks were previously reinsured, would refuse to pay compensation in case of potential insurance events affecting Deripaska's businesses.
The Russian National Reinsurance Co. President Nikolay Galushin told the newspaper that the company's share in reinsuring the risks of companies forming Deripaska's Basic Element Group increased significantly after the introduction of the sanctions, although he did not provide a specific figure. A source cited by Vedomosti said Ingosstrakh reinsured all risks of Deripaska's firms at the state reinsurer.
Meanwhile, VTB Bank CEO Andrey Kostin said the lender will not offer new loans to, and is "not having any operations" with, Deripaska and his companies after he was included in the U.S. sanctions list, CNBC reported May 23.
The executive also said that the bank is waiting for the next step of the U.S. Office of Foreign Assets Control, and added that the bank's business will not be significantly affected by the April sanctions. "The business with newly sanctioned institutions represents less than 2% of our assets, so of course it will affect us to a certain extent, but we still have to see what's going to happen with them as there's some discussion that they could be lifted for Rusal and some other companies," he was cited as saying.
Kostin also said that the bank was ready to give Rusal more time to make repayments on its loans, Reuters reported the same day, citing news agency TASS.
