Italy's UniCredit insists it is not cutting headcount or closing branches in Russia even as foreign rivals Citigroup, Societe Generale and Raiffeisen retrench.

"We don't have the problems [of other foreign lenders]," Carlo Vivaldi, head of the bank’s Central and Eastern Europe division, told bne IntelliNews on the sidelines of the recent EBRD  conference in London. "We have a more flexible business model and a smaller number of branches focused on large corporates and high net-worth individuals. At this moment, we will defend our exposure to the customers on the lending side and we don't see any major restructuring."

UniCredit is a top four foreign lender in Russia. The other three, Societe Generale, Citigroup and Raiffeisen, have been cutting back their loan book and shutting branches and regional offices as the Russian economy struggles under Western sanctions and to emerge from a two-year recession.

bne IntelliNews revealed in March that US lender Citigroup is shutting 10 branches this year after some closures in 2015, and has already shrunk its retail client base to 700,000 from 1mn less than a year ago. Raiffeisen Bank International plans to cut its risk-weighted assets in Russia by 20% in euro terms by the end of 2017; and Societe Generale's Russian unit cut about 1,500 jobs last year.

Vivaldi said headcount in Russia is "stable" and the bank is trying to maintain its loan book but admitted it is contracting now. "For us, Russia is a key market. We are trying hard to stay stable but it is contracting now," he said. "A lot depends on the fluctuation of the exchange rate."

UniCredit, which was established in Russia as the International Moscow Bank in 1989, has 102 branches across the country. The bank has abouyt 4,000 employees in Russia, about 1.7mn retail clients and almost 28,000 corporate customers, according to its website.

The lender's local chief executive Mikhail Alekseev said in April that the efficiency of the banking sector is sliding and the ongoing purge of scores of banks by the Central Bank of Russia (CBR) is causing nervousness among customers and undermining confidence in the banking system.

UniCredit problem loans on Russia are "very low" and lower than the average of central and eastern Europe, according to Vivaldi. After being pressed, he said they were in low single digits and not much more than 5%.

UniCredit was one of the few international lenders to show willingness to take part in the Kremlin's controversial $3bn Eurobond deal, which was scuppered by the US government.  

"We were in discussions and we had good communication with the Ministry of Finance," said Vivaldi, who declined to say if the deal could be revived.

The US Treasury warned banks that participation in the deal would undermine international sanctions imposed on Moscow in 2014 for its role in the Ukraine conflict. The Russian sovereign has not been sanctioned, but many international lenders will be fearful of raising the hackles of US regulators.  

The bank helped advise energy monopoly Gazrpom, steelmaker Evraz and miner Norilsk Nickel on Eurobond deals worth €2.7bn late last year after debt capital markets reopened briefly for blue-chip Russian issuers.

Vivaldi was philosophical about the opportunity to do similar deals for UniCredit's large Russian clients this year.  

"It's difficult the situation in the country," he said. "We try to stay close to our customers. As soon as there is an opportunity, we are trying to do what we can within the framework of sanctions and the rules imposed on banks."