Croatia's state-owned bank HPB announced on Tuesday the takeover of the Croatian subsidiary of Russia's Sberbank, adding that that "all the bank's deposits are now safely secured."

“The clients’ money is secure again, and the conditions for doing business remain unchanged,” HPB said in a press release, adding that at noon on Wednesday the bank would reopen its branches and resume regular operations as part of HPB.

The takeover comes after a directive from the EU’s Single Resolution Board, an agency of the EU’s banking union, which ordered the dismantling of branches of some Russian-owned banks in the EU, as the sanctions imposed following Russia’s invasion on Ukraine severely crippled their liquidity. Sberbank is the largest bank in Russia, with majority stake held by the Russian government.

In a news conference on Wednesday, the central bank governor, Boris Vujcic, said that if the bank had been allowed to fail the government would be forced to pay the bank’s clients some 8 billion kuna (€1 billion) for lost deposits. HPB’s acquisition of Sberbank, Vujcic said, cost 71 million kuna (€9.4 million).

Before the ongoing crisis in Ukraine, Sberbank operated subsidiaries in a number of European countries including Slovenia, Croatia, Bosnia, and Serbia. Due to fears of a bank run, the central bank had imposed a cash withdrawal limit for the bank’s clients earlier this week.

“We responded in an exceptionally short time and enabled our fellow citizens to freely dispose with their funds. At the same time, by taking over Sberbank, we are strengthening the HPB’s future position on the market,” said the lender’s CEO, Marko Badurina.

The state-owned HPB is the sixth largest bank in Croatia, although it only accounts for 5.5 percent of banking sector’s assets, as the market is dominated by foreign-controlled lenders such as PBZ, owned by the Italian group Intesa Sanpaolo, Zaba, owned by UniCredit of Italy, OTP Bank of Hungary, and others.

The two-day moratorium on withdrawals and payments expired on midnight, the central bank said, adding that starting on Wednesday the bank’s clients would be able to resume normal business.

Similar takeovers have also been completed in Slovenia, where Nova Ljubljanska Banka (NLB) bought the local Sberbank branch for an undisclosed figure.

In Bosnia, Sberbank operates two separate branches. The one registered in Banja Luka and active in the Republika Srpska half of the country was fully taken over by the local government, authorities announced on Tuesday, and the other one, registered in Sarajevo and active in the Federation BiH half of the country, was acquired by ASA Bank, who said in a press release that the acquisition made them the third largest lender in Bosnia and Herzegovina.

The Serbian subsidiary of Sberbank was acquired by the Belgrade-based AIK Banka, which now accounts for 9 percent of Serbia’s banking sector.

(€1 = HRK 7.5)