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Goldman Sachs and Western Union cut ties with Russia


Goldman Sachs and Western Union have become the latest big names to cut ties with Russia following the invasion of Ukraine.

Goldman Sachs Group Inc, which has offices in Moscow, said on Thursday it was closing all its operations in Russia, which makes it the first major Wall Street bank to exit the country. 

It comes after the latest round of companies pulled out of Russia, with video game makers Nintendo and Sony halting all product shipments, Burger King pulling support for franchises, packaged food giants Nestle and Mondeleze International halting investment, and tobacco groups scaling back operations.

Goldman’s activity in Russia was relatively minimal, and the investment bank’s move is largely symbolic, but it will put pressure on other Wall Street firms to cut ties, deepening Moscow’s financial isolation.  

‘Goldman Sachs is winding down its business in Russia in compliance with regulatory and licensing requirements,’ the bank said in an emailed statement.

A source familiar with the situation said Goldman would wind down the operations rather than exit them immediately. The loss due to the exit would be immaterial, the source said.

Goldman Sachs Group Inc, which has offices in Moscow, said on Thursday it was closing all its operations in Russia, which makes it the first major Wall Street bank to exit the country

A sign is seen outside a Western Union office in Moscow in a file photo. Western Union said Thursday that it is suspending all operations in Russia and Belarus

A sign is seen outside a Western Union office in Moscow in a file photo. Western Union said Thursday that it is suspending all operations in Russia and Belarus

In its annual filing earlier, the bank had disclosed a credit exposure to Russia of $650 million.

Bank of International Settlements data shows that U.S. bank exposure to Russia totals $14.7 billion. 

On Thursday, Western Union said in a statement: ‘We also have engaged in extensive dialogue with a wide variety of stakeholders in an earnest effort to arrive at the right decision regarding our services in Russia and Belarus. 

‘We have thoroughly evaluated internal and external considerations, including the consequences for our valued teammates, partners, and customers. Ultimately, in light of the ongoing tragic impact of Russia’s prolonged assault on Ukraine, we have arrived at the decision to suspend our operations in Russia and Belarus.’ 

Operating in Moscow has been increasingly difficult for Western financial institutions amid international sanctions against Russia. 

Citigroup Inc said on Wednesday it was operating its Russian consumer business on a more limited basis while sticking with its previous plans to divest the franchise.

Other U.S. banks operating in Russia include JPMorgan, which declined to comment on what its plans were. 

Videogame makers Nintendo and Sony join the Russia exodus 

PlayStation maker Sony and Nintendo said they have suspended shipments of software and hardware to Russia following the invasion of Ukraine.

Sony Interactive Entertainment, which makes the PlayStation 5 console, said it has suspended the launch of racing game ‘Gran Turismo 7’ and operations of the PlayStation Store in Russia.

Sony Group also announced it made a $2 million donation to the United Nations High Commissioner for Refugees and Save the Children ‘to support the victims of this tragedy.’

Sony Interactive Entertainment, which makes the PlayStation 5 console, said it has suspended all hardware and software shipments to Russia

Sony Interactive Entertainment, which makes the PlayStation 5 console, said it has suspended all hardware and software shipments to Russia

Nintendo said it is suspending shipping all products to Russia ‘for the foreseeable future… due to considerable volatility surrounding the logistics of shipping and distributing physical goods.’

The Kyoto-based firm also said it has delayed the release of ‘Advance Wars 1+2: Re-Boot Camp’, which was due to launch on its Switch console on April 8, because of ‘recent world events.’

The turn-based strategy series has a military theme.

Nintendo last week said it put its eShop under maintenance in Russia after its payment provider suspended transactions in Russian rubles.

Burger King withdraws support for franchises in Russia

Burger King on Thursday became the latest quick-service chain to halt or limit its operations in Russia.

Parent company Restaurant Brands International chain said it will halt corporate support for the 800 franchisee-owned restaurants in Russia, as well as refuse approvals for any investment or expansion. 

The suspension also includes pausing operations, marketing and its supply chain.

Meanwhile, McDonald’s said on Wednesday that the temporary closure of its 847 stores in Russia will cost the fast-food chain about $50 million a month.

Pedestrians pass a Burger King fast food restaurant, operated by Burger King Worldwide Inc., in Moscow in a file photo. Burger King is withdrawing corporate support for Russian franchises

Pedestrians pass a Burger King fast food restaurant, operated by Burger King Worldwide Inc., in Moscow in a file photo. Burger King is withdrawing corporate support for Russian franchises

A cascade of major American brands, including Starbucks, PepsiCo, Coca-Cola Co, and KFC said on Tuesday that they would cease some or all business in Russia following Moscow’s invasion of Ukraine.

McDonald’s, an icon of the post-Soviet era, runs 84 percent of its Russian locations itself and said it will continue paying all of its 62,000 staff and restaurant employees there. 

Other costs will come from sites it leases and supply chain operations, Chief Financial Officer Kevin Ozan said during a UBS conference on Wednesday.

‘This is a really challenging and complex situation for a global company like us,’ he said.

Seven other fast-food brands with more than 2,600 outlets combined in Russia could also take a financial hit from any decisions to pull out, even though nearly all of those restaurants are owned and operated by independent franchisees.

A person enters a McDonald's restaurant in Moscow, Russia on Wednesday. McDonald's says it expects to lose $50 million per month by pausing operations in Russia

A person enters a McDonald’s restaurant in Moscow, Russia on Wednesday. McDonald’s says it expects to lose $50 million per month by pausing operations in Russia

The owner of KFC is the latest company to pause business in Russia in response to the country's invasion of Ukraine

The owner of KFC is the latest company to pause business in Russia in response to the country’s invasion of Ukraine

Papa John’s said in a regulatory disclosure on Wednesday that it could end up having to absorb the cost of $15.2 million of receivables associated with its master franchisee in Russia, which runs all of its 188 restaurants there.

Royalties from the franchisee made up less than 1 percent of Papa John’s total revenue in 2021, the company said.

The pizza chain also said Wednesday that it ceased all operational, marketing and business support to – and engagement with – the Russian market, and that it is not receiving any royalties from restaurants there. 

Its Russia franchisee owns and operates its own supply chain. 

Yum Brands Inc, Kentucky-based parent company of the fried chicken chain KFC, said Wednesday that it was was suspending operations of 70 of its at least 1,000 restaurants in the country.

Most of the KFC locations in Russia are owned by franchise and license partners, which may complicate efforts to shutter the operations. 

The company, which also owns Pizza Hut, also said it was finalizing an agreement to suspend operations of all 50 of the pizza chain’s Russian locations. 

‘Yum! Brands is suspending operations of KFC company-owned restaurants in Russia and finalizing an agreement to suspend all Pizza Hut restaurant operations in Russia, in partnership with its master franchisee,’ the company said. 

The company added that it would donate all profits from operations in Russia to humanitarian efforts.  

US hotel chains freeze new investments in Russia 

Three major international hotel chains based in the United States have also frozen their investments in Russia and put on hold any planned openings of new hotels there.

Marriott on Thursday joined Hyatt and Hilton, which on Wednesday ceased any development of properties after Russia invaded Ukraine two weeks ago.

Marriott, like Hilton, said it’s shuttering its corporate office in Moscow as well.

Marriott hotels in Russia are owned by third parties and the company said it is evaluating the ‘ability’ of those locations to remain open. Hyatt also said it’s evaluating the operations of hotels that remain open there.

Amazon has become the latest Western company to halt operations in Russia, suspending product shipments and cutting off access to Prime Video

Amazon has become the latest Western company to halt operations in Russia, suspending product shipments and cutting off access to Prime Video

All three hotels are either earmarking aid funds, donating profits from Russian properties, or opening hotel rooms to refugees in Europe.

On Wednesday, Amazon halted operations in Russia – suspending product shipments and cutting off access to Prime Video.

Russia was not a major market for the online retail giant, making the announcement largely symbolic, but it adds to the flood of iconic US companies cutting ties, including McDonald’s, Coca-Cola and Pepsi.  

‘We’ve suspended shipment of retail products to customers based in Russia and Belarus,’ Amazon said in a statement. 

‘We are also suspending access to Prime Video for customers based in Russia, and we will no longer be taking orders for New World, which is the only video game we sell directly in Russia,’ the company added. 

Amazon does not operate dedicated online stores for Russia, but shoppers there can get products shipped from Amazon’s outpost in German.

The company’s cloud computing arm, Amazon Web Services also suspended all sales in Russia. 

Amazon said that it has no data centers, infrastructure, or offices in Russia, and reaffirmed that it has a long-standing policy of not doing business with the Russian government.   

Major US business to pull out of Russia 

Amazon: Suspended shipments and Prime Video but had no physical presence.

Apple: Suspended all product sales but had no retail locations.

Coca-Cola: All business in Russia suspended. Operated 10 bottling plants through a licensed partner.

KFC: Parent company Yum Brands is suspending operations of 70 of its at least 1,000 KFC restaurants in the country. 

McDonald’s: Operations suspended at all 847 locations in Russia. McDonald’s will continue to pay 62,000 workers there. 

Microsoft: All sales of new products suspended in Russia.

Netflix: Service suspended in Russia. 

Papa John’s: All corporate operations suspended, but 188 franchisee-owned locations will continue to operate independently without corporate support.

PepsiCo: Suspended sales of Pepsi and other sodas but will continue to sell essential items such as baby formula. Operates two bottling plants in Russia and employs 20,000 workers there.

Pizza Hut: Yum Brands is finalizing an agreement to suspend operations of all 50 of its Pizza Hut locations in Russia. 

Starbucks: Suspending operations at all 130 Russian locations. Will continue to pay 2,000 workers during the shutdown. 



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