Andrey Kostin, who runs Russia's second-largest bank, warned that proprietors are reluctant to invest, worried that the government might confiscate their assets at any time. Speaking at the International Banking Forum on Thursday, and cited by Vedomosti, he highlighted property-rights worries and quoted a common refrain from owners: "They'll take it away from us anyway."
Kostin said Russia's business climate is getting worse and that sanctions are not the only reason. He pointed to weak protection of property rights as a key factor behind the anxiety keeping capital on the sidelines.
Russia is in an investment slump that critics attribute to central bank Governor Elvira Nabiullina's decision to maintain elevated interest rates for a prolonged period. Restarting the investment cycle is a stated priority for President Vladimir Putin.
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Since Russia's full-scale invasion of Ukraine in 2022, officials have taken sizable amounts of property from domestic companies and moved it into state hands under a range of justifications. They have also taken control of multiple international companies that did not leave. Last week, the Kremlin tapped a little-known firm to assume management of the Russian plants of Nestle SA, a Swiss food giant, and Auchan, a French retailer, following decrees signed by Putin. Moscow linked those takeovers to European military support for Ukraine.
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