Western Banks in Russia Shrink to Cold-War Levels as China Rises

Western banks’ exposure to Russia is falling toward levels last seen before the collapse of the Soviet Union, as sanctions crimp business and they lose ground to Chinese lenders benefiting from a surge in the share of yuan-denominated trade.

Banks from Europe and the US will have exposure of less than $60 billion to Russia this year, compared with about $40 billion at the end of the 1980s and $10 billion at the beginning of that decade, according to analysts at Raiffeisen Bank International AG, itself the owner of the largest foreign-owned bank in Russia. That’s down from $119 ...