Grizzly Research shorts Raiffeisen Bank, alleging $1.2B in sanctions-entangled Russian trade

Short-selling firm Grizzly Research has taken aim at Raiffeisen Bank International, publishing a detailed report that accuses the Austrian lender’s Russian subsidiary of facilitating over $1 billion in trade tied to Western sanctions restrictions. RBI shares dropped roughly 9% on the day the report landed.

The core allegation: Grizzly claims that AO Raiffeisenbank, RBI’s Moscow-based subsidiary, has been linked to $1.191 billion in trade that intersects with sanctions imposed by the EU, US, UK, and Switzerland. That figure alone would raise eyebrows, but one subset makes the accusation particularly pointed.

Rifle scopes and missile components

According to Grizzly’s report, roughly €106.75 million of those trade flows involved goods on the Common High Priority List. That’s the catalog of sensitive technologies Western governments have flagged as potentially usable in military applications, including items like rifle scopes and components for tanks and missiles.

Grizzly CEO Siegfried Eggert described RBI’s Russia business as “very active” during a CNBC interview on the same day the report was published.

The trapped cash problem

The second major thread in Grizzly’s report concerns money stuck inside Russia’s borders. Grizzly alleges that approximately €12.6 billion in Russian cash and central bank placements are effectively trapped within the country. RBI itself has disclosed only €735 million in legally restricted cash.

RBI’s Russian subsidiary remains the largest unsanctioned Western bank still operating in Russia. Multiple prior attempts to exit have been blocked by Russian government decrees and litigation, creating a situation where the bank appears stuck in a market it publicly wants to leave but practically cannot.

RBI’s response and market fallout

RBI moved quickly to dismiss Grizzly’s claims, though the bank’s rebuttal has not fully stemmed the damage. The nearly 9% single-day share decline suggests investors took the report seriously enough to reprice the stock, at least in the short term.

RBI’s Russian subsidiary has been profitable, generating meaningful net interest income and tax payments to the Russian government even as the geopolitical situation deteriorated.

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