Up to three-quarters of Credit Suisse’s Russian clients will have to look for a new bank, according to a report in the NZZ am Sonntag. This is because the risks are too high for Swiss bank UBS, which recently took over its rival, Credit Suisse,  in a government-brokered merger.

Most Russian billionaires banking with Swiss banks are perceived to be high risk clients because often times, their money is said to be proceeds of underhand dealings in oil and gas and other businesses.

Besides, most of the Russian oligarchs are close associates of Vladimir Putin, who is now seen as enemy number one by the West on account of his invasion of Ukraine.

It is not clear exactly which Russians are affected, the paper wrote. However, they are said to be primarily Russian offshore clients: clients with a Russian passport who live abroad and who are currently serviced by Credit Suisse from Switzerland on a cross-border basis.

UBS did not want to take a position on the issue, the NZZ am Sonntag said, but it did mention its lower appetite for risk than its former competitor. Moreover, it wanted to “anchor its risk management principles and corporate structure throughout the combined organisation” of UBS and Credit Suisse, it told the paper.

The bank’s decision would also affect other Credit Suisse clients in other regions, but to a lesser extent, according to the NZZ am Sonntag.

In yet another development, Swiss private bank Julius Bär is set to end all business with clients based in Russia, it told them in a letter seen by Reuters on Tuesday.

The bank will cease business with clients domiciled in Russia by no later than December 31, the letter said, while wealth management activities such as mandates managing clients’ investments, credit agreements and credit card contracts, would be terminated by the end of September.

Julius Bär declined to comment.

The move comes as Swiss banks, hubs for offshore wealth, have entered the crosshairs of authorities, who have been using sanctions, asset freezes and criminal probes to pressure Russia’s wealthy elite and reduce support for President Vladimir Putin.

In March, Bloomberg reported that Switzerland’s two biggest banks at the time – Credit Suisse and UBS – were under scrutiny in a US Department of Justice (DOJ) probe into whether financial professionals helped Russian oligarchs evade sanctions.

Credit Suisse has since been taken over by UBS, making Julius Baer the second-largest of Switzerland’s listed lenders.

In a deviation from its traditional neutrality, Switzerland moved in March 2022 to adopt sanctions that the European Union (EU) imposed on Russian people and companies and freeze their assets to punish the invasion of Ukraine.

It has since continued to widen sanctions in line with EU moves.

As of November 25, 2022, Switzerland had frozen some CHF7.5 billion ($8.63 billion) in related financial assets, the agency overseeing sanctions said in December, compared to some CHF46.1 billion in existing deposits held by Russian nationals and Russian-domiciled persons.

In March 2022 Julius Bär said it was halting any new business with wealthy Russians, as European lenders worked to limit their exposure to Russia’s elite.

Forbes Russia in May reported that Julius Baer had told Russian and Belarusian clients that their investment accounts would be frozen due to requirements from clearing house Euroclear.

-Additional reports by Swissinfo.ch