Part UK-owned bank Lloyds quits Russian oil loan deal to avoid government embarrassment

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British bank Lloyds has pulled out of a big loan involving the Russian oil company Rosneft.

The move highlights the growing unease among Western banks in funding Russian deals.

Lloyds, along with Deutsche Bank, HSBC and Bank of China, was was a lead lender in the 1.5 billion euro deal.

It involves financing for BP to purchase crude and refined oil products from Rosneft, whose chief executive Igor Sechin is the subject of US sanctions.

Reuters was told by banking sources close to the talks that Lloyds had decided to walk away after several weeks of hesitation.

There was potential for embarrassment as Lloyds is 25 percent owned by the British government, which has repeatedly condemned the Kremlin for its actions in Crimea and eastern Ukraine.

BP, Rosneft and Lloyds all declined to comment.

HSBC – which is still part of this deal – is also reportedly not looking to conduct new business in Russia, because of concerns about future sanctions.

with Reuters

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