Vladimir Putin has approved the sale of Goldman Sachs' Russian subsidiary to the Armenian investment firm Balchug Capital. The transaction, whose value was not disclosed, marks the near complete withdrawal of the US investment bank from Russia – almost three years after announcing its planned exit following the Ukraine war.

Western financial institutions have been struggling since then with strict Russian regulations for corporate sales. Moscow only allows sales by companies from "unfriendly" countries with state approval and limits the price to a maximum of 50 percent of the market value. Banks and energy companies are subject to even stricter rules: Putin's personal approval is required for their sales.

While Goldman is now on the verge of final withdrawal, larger European banks remain trapped in Russia. The Dutch ING announced its exit on Tuesday, recording a loss of 700 million euros. Raiffeisen, on the other hand, which is heavily engaged in Russia, has so far shown no concrete progress in its withdrawal process and continues to face public pressure.

Goldman Sachs has been active in Russia since 1998, but focused only on investment banking services there and avoided the retail business. The bank currently ranks 229th among Russian financial institutions. Its Russian assets decreased by nine percent to 4.95 billion rubles in the first nine months of 2024, while liabilities fell by 50 percent to 1.31 billion rubles. At the same time, net profit increased, driven by lower operating costs and a strong rise in interest income.

Balchug Capital, founded in 2010 by David Amaryan, has acquired several Western companies that had to withdraw from Russia in the past two years. In 2024, the investment company purchased the Russian assets of Caterpillar, and the year before, it acquired, among others, the Pulkovo Sky Business Center in St. Petersburg and the Metropolis Shopping Center in Moscow from US and Finnish investors.

The Armenian origin of Balchug enabled the purchase circumventing Western sanctions, as Moscow classifies the country as "friendly". Since the invasion of Ukraine and the Western sanctions, Armenian financial actors have established themselves as intermediaries between Russia and international markets.