Goldman Sachs has decided to shut down its operations in Russia, becoming the first major Wall Street bank to quit the country after Western governments imposed heavy economic sanctions on Moscow over the Ukraine crisis.
“Goldman Sachs is winding down its business in Russia in compliance with regulatory and licensing requirements,” the bank said on Thursday in a statement. “We are focused on supporting our clients across the globe in managing or closing out pre-existing obligations in the market and ensuring the well-being of our people.”
Goldman has had a presence in Russia since 1998 and reportedly worked on some of the country’s most significant financial transactions, including a $4-billion initial public offering by VTB Bank and major lending packages for energy giants Gazprom and Rosneft. The investment bank will continue to facilitate trades of Russian debt securities, but it will no longer operate in the country or underwrite financial offerings.
“In our role as market-maker standing between buyers and sellers, we are helping our clients reduce their risk in Russian securities which trade in the secondary market, not seeking to speculate,” Goldman said.
The move follows a flood of major multinational corporations announcing plans to exit Russia. Consumer brands, in particular, have faced growing public pressure, including threats of boycotts, to punish Moscow over its military offensive in Ukraine. On Tuesday alone, US food-service and beverage giants McDonald’s, Coca-Cola, PepsiCo and Starbucks announced that they were suspending operations in Russia.
Goldman’s announcement comes one week after a former banker with the company posted an open letter to CEO David Solomon calling on him to quit Russia “as a sign of protest” and to stay “on the right side of history.” The banker, Russian-born UK resident Georgy Egorov, scolded Solomon for failing to condemn the Russian invasion of Ukraine. The CEO later posted a message referring to the conflict as “tragic” and calling for peace in the region.
Also last week, US Senator Elizabeth Warren (D-Massachusetts) accused Goldman and JPMorgan Chase & Co. of undermining sanctions against Russia by purchasing Russian corporate bonds at discounted prices and advising customers to buy bargain assets.