Russian Court Seizes Deutsche Bank, Commerzbank Assets

FILE PHOTO: An exterior view shows an office building, which houses the Russian headquarters of Deutsche Bank, in Moscow, Russia, September 17, 2015. REUTERS/Maxim Zmeyev/File Photo
FILE PHOTO: An exterior view shows an office building, which houses the Russian headquarters of Deutsche Bank, in Moscow, Russia, September 17, 2015. REUTERS/Maxim Zmeyev/File Photo
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Russian Court Seizes Deutsche Bank, Commerzbank Assets

FILE PHOTO: An exterior view shows an office building, which houses the Russian headquarters of Deutsche Bank, in Moscow, Russia, September 17, 2015. REUTERS/Maxim Zmeyev/File Photo
FILE PHOTO: An exterior view shows an office building, which houses the Russian headquarters of Deutsche Bank, in Moscow, Russia, September 17, 2015. REUTERS/Maxim Zmeyev/File Photo

A Russian court has ordered that Deutsche Bank's and Commerzbank's assets, accounts, property and shares be seized in Russia as part of a lawsuit involving the German banks, court documents showed.
The banks were among the guarantor lenders under a contract for the construction of a gas processing plant in Russia with Germany's Linde, which was terminated due to Western sanctions, Reuters reported.
The lawsuits were filed by St Petersburg-based RusChemAlliance, a joint venture 50% owned by Russian gas giant Gazprom which is the operator of the project.
The St Petersburg arbitration court has barred Deutsche Bank from exercising its 100% interest in the authorized capital of its Russian subsidiary, as well as Deutsche Bank Technology Center LLC.
The court has also imposed the seizure of up to 238.6 million euros ($259 million) in securities, real estate and bank accounts of Deutsche Bank, as well as its Russian subsidiary and Deutsche Bank Technology Center.
Deutsche Bank in Frankfurt said it had already provisioned around 260 million euros for the case.
"We will need to see how this claim is implemented by the Russian courts and assess the immediate operational impact in Russia," the bank said in a statement.
The court also seized Commerzbank's assets worth 93.7 million euros ($101.85 million) as well as securities and the bank's building in central Moscow.
Commerzbank did not immediately respond to a request for comment.
The Russian court on Friday ordered UniCredit's assets, accounts and property, as well as shares in two subsidiaries, be seized as part of a parallel lawsuit.



Germany's Coalition in Impasse Over 2025 Budget

FDP Finance Minister Christian Lindner (L), Greens Economy Minister Robert Habeck (C) and Chancellor Olaf Scholz (R) of the SPD are locked in a budget dispute - AFP
FDP Finance Minister Christian Lindner (L), Greens Economy Minister Robert Habeck (C) and Chancellor Olaf Scholz (R) of the SPD are locked in a budget dispute - AFP
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Germany's Coalition in Impasse Over 2025 Budget

FDP Finance Minister Christian Lindner (L), Greens Economy Minister Robert Habeck (C) and Chancellor Olaf Scholz (R) of the SPD are locked in a budget dispute - AFP
FDP Finance Minister Christian Lindner (L), Greens Economy Minister Robert Habeck (C) and Chancellor Olaf Scholz (R) of the SPD are locked in a budget dispute - AFP

The three parties in the German government are locked in a bitter dispute over the 2025 budget, with experts warning the stalemate could be the final straw for the uneasy coalition.

Chancellor Olaf Scholz's Social Democrats (SPD), the Greens and the liberal FDP, who came to power in 2021, have until July 3, the end of the current parliamentary term, to reach a compromise, AFP reported.

FDP Finance Minister Christian Lindner, a fiscal hawk, is demanding close to 30 billion euros ($32 billion) in savings -- which the Greens and SPD have baulked at.

The coalition has faced many rows in the past but some pundits believe this could be the one that finally blows the government apart.

"These talks will decide the coalition's continued presence in office," said the Sueddeutsche Zeitung daily this week.

While budget discussions have been difficult before, they have never lasted this long.

"It's much more difficult than usual," Jacques-Pierre Gougeon, an expert on German politics at the French Institute for International and Strategic Affairs, told AFP.

He pointed to a gloomy backdrop due to Germany's poor performance in recent times, with Europe's biggest economy hit hard by high inflation and a manufacturing slowdown.

According to the finance ministry, tax revenues for 2025 are set to be 11 billion euros lower than originally forecast.

A ruling by the country's top court in November that the coalition had contravened the constitutionally enshrined "debt brake", a self-imposed cap on annual borrowing, has also limited room for new spending.

In addition, all three parties are increasingly worried about their own levels of support after doing badly at this month's EU elections -- in which the opposition conservative CDU-CSU bloc came first, with the far-right AfD second.

A key sticking point in discussions centres on unemployment benefits.

Lindner wants to restrict the current payouts, which he believes are too expensive and do not provide enough of an incentive to get people to return to work.

But the SPD won't accept this. Improving benefits was central to the party's 2021 election campaign as they sought to win back support of lower-income voters.

"Politically, the Social Democrats cannot afford to give it up," said Gougeon.

There is also disagreement about any measures affecting diplomacy and defence, at a time when Germany is seeking to stand up for liberal, European values and overhaul its creaking military in the wake of Russia's invasion of Ukraine.

Defence Minister Boris Pistorius is calling for an increase in his ministry's budget, and for military spending not to be covered by the debt brake.

"It would be disastrous to have to say in a few years' time: we saved the debt brake at the expense of Ukraine and the European security order," said Foreign Minister Annalena Baerbock, from the Greens.

While calls have grown for the debt rules to be relaxed, Lindner and the FDP categorically refuse to countenance any changes.

Maintaining the brake is an "existential question" for the party, according to Gougeon.

Lindner did however promise on Wednesday not to push for any savings in defence.

Scholz, Lindner and Economy Minister Robert Habeck, from the Greens, are due to meet Sunday in an attempt to make progress.

The aim is to prevent "the budget crisis from turning into a crisis of confidence", which could lead to new elections, according to the left-leaning daily TAZ.

The parties may ultimately compromise as the alternative -- a collapse of the government -- will not be in their favour.

They "know that they would be swept aside if there were new elections, and will want to avoid them", said Gougeon.