Bloomberg: DBS hiring private bankers to cater to wealthy Russian clients as other banks cut back over sanction risks

DBS is reportedly expanding its wealth management team to cater to rich Russian clients.

Bloomberg: DBS has become the bank of choice for wealthy Russians in Asia

According to a Bloomberg report on Dec. 3, the bank recently hired two Russian-speaking private bankers — one from Swiss private bank Union Bancaire Privée in June, and another from Credit Suisse in September.

The hiring comes as other banks are staying away due to the risk of sanctions over the conflict in Ukraine.

Banks such as HSBC have severed ties with Russian clients over concerns of penalties from Europe and the U.S.

In addition, on Nov. 22, 2024, HSBC said it had stopped processing all payments from Russia for personal banking customers, according to Reuters.

Another bank, UBS, has come under scrutiny from the U.S. regarding Russian clients that it took on from when it bought Credit Suisse, Reuters reported.

The U.S. sanctions enforcement agency, the Office of Foreign Assets Control (OFAC), has written to UBS as part of its inquiry into the Russian clients.

Bloomberg further noted in its Dec. 3 report that DBS has become the "go-to" wealth manager for wealthy Russians in Asia however, following its hiring of several private bankers from Credit Suisse and Julius Baer, another Swiss private bank, over the past two years.

Bloomberg noted that Russian wealth assets are a small fraction of the S$401 billion that DBS manages for private and retail banking customers, but contrasted the growth of such assets against other banks which have cutting back.

DBS: We will not deal with anyone who is afoul of the bank's controls

In response to media queries, a DBS spokesperson was quoted as saying that the bank welcomes any client who favours its suite of products and services.

The spokesperson added:

"However, we will not deal with anyone who falls afoul of our controls (including sanctions screening or money laundering surveillance) or our risk appetite."

The spokesperson also clarified that DBS does not have a specific team that serves Russians alone. The bank also does not target Russians specifically.

Singapore enacted sanctions against Russia in March 2023

Following the start of Russia's invasion of Ukraine in February 2022, the Ministry of Foreign Affairs (MFA) announced financial measures against Russia in March 2022.

Digital payment token service providers, in particular, are prohibited from facilitating transactions that could help circumvent these measures. This includes transactions involving cryptocurrencies, as well as digital assets like non-fungible tokens (NFTs).

MFA added, "These measures apply to all financial institutions in Singapore, including banks, finance companies, insurers, capital markets intermediaries, securities exchanges and payment service providers."

The measures are aimed at selected Russian banks, entities and activities, as well as fund-raising activities that benefit the Russian government.

Mothership has reached out to DBS for more information.

Photo via DBS/Facebook