
‘Dead’ derivatives market leaves big Russia dealers unhedged
VTB and Sberbank face directional exposure to local corporates after mass unwinds by foreign banks

Russia’s over-the-counter derivatives market has been declared “dead”, as foreign banks try to escape trades with local dealers in the wake of swingeing international sanctions. The move is likely to leave Russian banks such as VTB and Sberbank stuck with unhedged exposure to local clients.
The US announcement of full blocking sanctions on VTB requires dealers to unwind their exposures to the bank by May 25. Sanctions on Sberbank, Russia’s largest lender, are less stringent, with foreign
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