Expansion of Sanctioned Russian Giant Bank, Alfa, in China Unveiled
Private Russian bank, governed by sanctioned tycoon Mikhail Fridman, has debuted a Chinese-language website and customer service platform for local businesses, as stated in a recent announcement. Additionally, branches are scheduled to open in Beijing and Shanghai, making Alfa Bank the first private Russian bank to establish full-service outposts in these key Chinese cities.
The announcement, initially made in September, suggested that this venture would enhance the efficiency of business operations for Russian clients in China. CNN has attempted to contact the bank for additional comment, but has yet to receive a response.
Back in February, the bank expressed that fostering relations with China was a top priority. Alfa Bank is part of Alfa Group, a significant Russian financial and investment consortium that was founded by Fridman. Following Russia's invasion of Ukraine in 2022, the United States and European Union implemented sanctions against the group and its associates, as part of their extensive penalties against Moscow over its military campaign.
These sanctions had a significant impact on Russian banks. Alfa Bank reported a massive loss of 117.1 billion rubles ($1.44 billion) in 2022, as reported by Reuters. However, the lender appeared to recover a year later, announcing a net profit of 118 billion rubles ($1.4 billion) in 2023, according to its financial statements.
China maintains a neutral stance on the conflict, yet has offered strong support to Russia and expanded their partnerships in various sectors. In 2023, China-Russia trade reached an all-time high of $240.1 billion, a 26% increase from the previous year, based on Chinese custom statistics.
The two nations have also reduced their reliance on the US dollar, with over 95% of mutual transactions conducted in Russian rubles or Chinese yuan in 2022, according to a senior Russian official during a visit to Beijing in November.
Last week, the US and its allies claimed that China was aiding Russia's war effort at the annual Group of Seven (G7) summit in Italy. G7 leaders also threatened additional measures, including sanctions, against Chinese entities believed to be assisting Russia in bypassing Western sanctions.
In its Tuesday statement, Alfa Bank noted that it was already collaborating with "thousands" of Chinese companies and had earned a AA- rating with a positive outlook from a large Chinese credit agency. Furthermore, the Hong Kong Equity Investment Association (HKEIA) recognized the bank as the most technologically advanced financial institution, it said.
CNN's Mariya Knight provided assistance in the reporting process.
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The Chinese-language website and customer service platform will facilitate business interactions between Alfa Bank and local Chinese companies. Due to the bank's expansion in China, it expects to improve business operations for its Russian clients.
