Russian-Hungarian bank in serious financial trouble

The Budapest-based International Investment Bank (IIB), which is majority owned by the Russian state, is in serious financial trouble. This can also be a problematic issue for Hungary, which is the second-largest owner of the bank after Russia.

According to hvg.hu, the bank’s financial problems started after Euroclear, which is one of the world’s largest securities transaction firms, blocked the Russian-Hungarian bank’s funds as part of the sanctions against Russia.

Leaked documents

Hvg.hu has published a comprehensive investigative report on the case. They write that the bank’s funds have been frozen as part of the sanctions imposed after the outbreak of the Russian-Ukrainian war. According to the report, the bank is in serious financial trouble as a result, and there is a risk that it will soon become completely insolvent. This information is based on a leaked letter written by one of the bank’s executives. The letter was addressed to the bank’s management. As written by hvg.hu, the letter reveals that there was still a chance to unblock the funds last October, but later the Belgian Ministry of Finance intervened. As it is written in the letter sent in December, the bank’s leadership was already aware at the end of last year that there was no possible way to unblock the funds.

Hvg.hu also claims that other leaked documents have also come into their possession. In February, the bank was hit by a cyber attack, and several bank documents and correspondence were published on the dark web. Although the IIB denies their authenticity, hvg.hu believes they are real. One of the most interesting letters comes from Márton Nagy, Hungary’s Minister for Economic Development. As hvg.hu writes, the letter was addressed by the Hungarian minister to the Belgian Finance Minister. In the letter he asks the Finance Minister to unblock the IIB’s funds.