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The government faces a challenge: Russia’s “spy bank” owes billions

The government faces a challenge: Russia’s “spy bank” owes billions

An exciting date is approaching in the lives of many Hungarian investors. The wary eyes of the aforementioned investors are on the international investment bank, the International Investment Bank, which is referred to in articles as the “Russian spy bank” and which was actually created on Russia’s initiative. The bank must repay Hungarian forints worth 15 billion forints in bonds to Hungarian investors by September 28. The question is how this could be possible under sanctions, reports.

Remember: After the bank and some of its directors were placed on the US sanctions list on April 12 this year, the next day, after several other EU countries, Hungary also indicated that it would withdraw from the bank.

Yes, but on the one hand, the exit is not that easy, and on the other hand, during the previous great friendship, the bank also had a lot of Hungarian investors. The Hungarian government invited the bank to Budapest, several other EU member states were also shareholders, and the bank paid better interest than the Hungarian state, even though its credit rating was higher than that of Hungary at the time.

In September 2020, local banks, investment fund managers and other investors subscribed a total of HUF 15 billion of 3-year IIB bonds. This series will end on September 28, and after the US imposed sanctions on the bank, its accounts in the European Union were also frozen, so it has become questionable whether Hungarian investors will get their money back.

The bank has the money, the bank has the intention to meet its obligations, so this is mostly a Western decision. The situation is so difficult

Recently, Hungary has been flogging the EU, the Swedes and the Americans a lot, and it is not necessarily strong in asserting its interests on a sensitive issue.

– At least that’s what some investors fear.

At the same time, one can be confident that the purpose of the sanctions is not to prevent Russians from reporting their debts to EU entities, namely the competent American office, OFAC (Office of Foreign Assets Control, i.e. Office of Foreign Assets Control). Control of foreign assets) You can even give individual permission for this.

As the IIB itself has documented in detail, the bank has the intention to pay. At least in a similar Czech case, where the bonds themselves had not yet expired, but there was an interest payment due, the Czech State Department lobbied the US government office to unilaterally allow the release of this amount, the so-called payment agent), i.e. Citibank Payment of interest due in Czech Koruna with declaration.

It is not certain that the Hungarian government is able to act effectively when asked to do so by the United States.

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