Deutsche Bank informs its customers that it can no longer guarantee full access to the Russian shares it owns. This was reported by Reuters on the basis of a circular from Deutsche Bank. DB has discovered a shortfall in so-called depositary receipts issued by the bank before the Russian invasion of Ukraine. Certificates of Deposit are the certificates that guarantee one or more foreign shares of a listed company.
These are certificates issued by Deutsche Bank before the invasion and are held in Russia by another custodian bank, according to Reuters. In the circular, Germany’s largest bank attributes the shortfall to a decision by Moscow to allow investors to share a stake in the receipts in local shares, the agency said. This conversion was carried out without the “involvement or supervision” of Deutsche Bank. And therefore he was unable to reconcile the company’s shares with the certificates.
Deutsche Bank is the first major bank to formally inform holders of certificates of deposit that they may not receive exactly all the shares they are entitled to, Reuters reports. These include shares in the national airline Aeroflot, the construction company LSR Group, the mining and steel company Mechel and Novolipetsk Steel.
A significant number of investors, from small hedge funds to large global asset managers, still hold certificates, Reuters said, despite all the Western sanctions and Russian countermeasures. However, most investors have reduced their Russian assets to zero, but some are still hoping to recover in value in the future.
Source: BNR
Andrew Dwight is an author and economy journalist who writes for 24 News Globe. He has a deep understanding of financial markets and a passion for analyzing economic trends and news. With a talent for breaking down complex economic concepts into easily understandable terms, Andrew has become a respected voice in the field of economics journalism.
