Another instance of Sinkapore being the preferred tax haven for Europeans

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An honorable member of the Coffee Shop Has Just Posted the Following:

Financial Times, 24 May 2013

Stepic offers to resign as head of Raiffeisen Bank

By James Shotter in Zürich

The chief executive of Raiffeisen Bank International has offered to resign amid mounting scrutiny of his involvement in property deals in Asia.

At a hastily convened press conference in Vienna, Herbert Stepic, one of Austria’s most prominent bankers, said that he had taken the step in order to protect the reputation of Austria’s third-largest lender by assets.

“As a result of recent press reports . . . it has become clear to me that a discussion is under way that is threatening to damage the standing of my company,” he said.

“I have informed Walter Rothensteiner, chairman of RBI’s supervisory board, that I am tendering my resignation as chief executive of RBI. In doing so, I want to do what I can to prevent what I consider my life’s work from suffering lasting damage from an emotional and populist debate.”

Raiffeisen said that the “responsible committees at RBI will promptly consider this proposal”. Mr Stepic will continue as chief executive until a decision is reached.

Mr Stepic has been under growing pressure since it emerged that he had used two letterbox companies, based in Hong Kong and the British Virgin Islands, to buy three flats in Singapore.

Austria is in the process of hunting down untaxed offshore assets held by its citizens and, to this end, recently signed withholding tax agreements with Switzerland and Liechtenstein.

Mr Stepic reiterated on Friday that the two companies, Yatsenko International Limited and Takego Holdings Limited, were not “offshore constructions, especially as all the investments were carried out with income that had been taxed in Austria”.

“These were actually real property investments that were completed via project companies,” he said. “I have no problem with laying open the details of the case to the relevant authorities.”

The Austrian Central Bank said on Thursday that it would scrutinise the deals and Raiffeisen is itself in the process of conducting an internal investigation. The FMA banking watchdog has also asked Mr Stepic to provide information.

Mr Stepic joined Raiffeisen in 1973 and has been a pivotal figure in the bank’s development, masterminding its expansion into central and eastern Europe, which started in the late 1980s, and accelerated after the collapse of communism. The bank is now present in 17 markets and one of the region’s largest lenders.

The veteran banker has also steered Raiffeisen through the financial crisis in better shape than most of its peers. It has posted just one quarterly loss since it was listed in 2005.

This is not the first time that his property dealings have attracted attention, however. The FMA also reviewed Mr Stepic’s involvement in a deal in Serbia before recently dropping its probe after concluding that he was no longer involved in the project.


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