Germany’s Deutsche Bank, Commerzbank Assets Seized by Russian Court Over Gas Facility Contsruction Dispute

By Trisha Andrada

May 20, 2024 06:48 AM EDT

Deutsche Bank

(Photo : Dan Kitwood/Getty Images)

A Russian court in the city of Saint Petersburg has ordered the confiscation of assets belonging to Deutsche Bank and Commerzbank, two German banks operating in the nation, following a dispute over a scheduled development of a Baltic Sea liquefied natural gas facility.

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German Banks Sued Over Canceled Gas Facility Construction

A gas processing facility was to be built by Turkish construction firm Renaissance Heavy Industries and German chemicals company Linde. The banks were guarantors in this deal, according to the Associated Press.

However, DW reported that the project was shelved after banks withdrew their guarantees in response to Western sanctions regarding Russia's invasion of Ukraine.

The project operator RusChemAlliance, a Russian gas giant Gazprom subsidiary, took legal action since it paid advances to Linde for the facility construction.

Deutsche Bank is being sued for around 238.61 million euros ($260 million), while Commerzbank is being sued for 94.92 million euros ($103 million), as reported by Associated Press, citing German press agency DPA.

Deutsche Bank said in a statement that it had set aside some 260 million euros ($283 million) as reimbursement under an indemnity arrangement. It also stated that it would measure the immediate operational effect in Russia and determine how the Russian courts would evaluate the allegation.

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