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S&P says Ukraine crisis cost Russian banks $5 billion

Russia’s five largest banks were left nursing costs of as much as $5bn on Ukraine-related assets last year and could face further costs of a “similar magnitude” this year, according to rating agency Standard & Poor’s.

The war in Ukraine, unsurprisingly, took its toll on the financial results of the biggest Russian banks in 2014. S&P estimates the five largest banking groups were forced to shoulder total costs on Ukraine-related assets of $4bn-$5bn last year – approximately 20 per cent-25 per cent of their aggregated operating revenues.

Costs are likely to continue rising this year as the banks’ Ukrainian subsidiaries battle against poor economic conditions in the recession-ravaged and war-torn country but S&P says the impact on the credit ratings of Russia’s banks may be “limited”.