By Valentina Za, Brenna Hughes Neghaiwi and Marc Jones

MILAN/ZURICH/LONDON (Reuters) -UniCredit could decide on a costly exit from Russia after its invasion of Ukraine, the Italian bank’s CEO said on Tuesday, as Credit Suisse disclosed 4% of its wealth management assets are managed for Russian clients.

A growing list of financial firms are looking to exit Russia, with Deutsche Bank, Goldman Sachs and JPMorgan Chase winding down business there. Others are under pressure from investors to detail their financial exposure to Russia.

UniCredit Chief Executive Andrea Orcel said the bank was urgently reviewing its Russian business, but needed to find a solution for its 4,000 local staff and European companies it serves which are also trying to leave.

Orcel also said the economic environment had changed because of the Ukraine crisis and the bank was now assuming there would be stagflation – or a combination of low growth and high inflation.

UniCredit’s Russian unit has around 8 billion euros ($8.8 billion) in loans, locally funded by deposits.

The loss in relinquishing the business would be 1.9 billion euros at most. Cross-border and derivatives exposure however add up to another 5.5 billion euros to the bill.

UniCredit is one of Europe’s banks most exposed to Russia.

TP ICAP, the world’s biggest inter-dealer broker, also said on Tuesday it had stopped all business transactions with Russian banks.

Credit Suisse last week detailed a gross credit exposure of 1.569 billion Swiss francs ($1.69 billion) to Russia at the end of 2021, which Chief Executive Thomas Gottstein said had been “reduced materially” by the end of February.

Gottstein told the Morgan Stanley Conference in London on Tuesday that the bank had “roughly 4% of our assets under management in wealth management with Russian clients, (either) Russian-domiciled or Russian nationals who live in the West.”

The bank had not previously detailed the amount of assets it manages for Russian clients.

Russia is subject to stringent sanctions and has introduced countermeasures following the invasion of Ukraine, which it calls a “special operation.”

In a sign of the pressure, the Russian central bank said it would suspend the buying of gold from banks from Tuesday to meet increased demand for the precious metal from households.

Russia’s second-biggest bank VTB is closing its London-based investment banking unit VTB Capital, it said.

Russia has $117 million in payments due on Wednesday on two dollar-denominated Eurobonds. Its finance ministry has said it will make the payments in roubles if sanctions prevent it from paying in dollars.

However, the payment due on Wednesday has to be made in dollars and using other currencies could constitute a default.

Russia’s economic crisis is likely to cause credit to go unpaid but euro zone banks’ exposure to the country is contained, the European Central Bank’s top supervisor Andrea Enria said, adding no blanket ban on dividends was on the cards.

Western governments continue to ratchet up the pressure as three European prime ministers rode a train for Kyiv on Tuesday, the first visit by foreign leaders to the Ukrainian capital since Russia launched its invasion.

The European Union has banned top credit rating firms from rating Russia’s sovereign debt and the country’s companies as part of its latest sanctions package, the European Commission said.

Britain imposed sanctions on hundreds of Russian individuals and entities, banned the export of luxury goods to Russia and said it had stopped all government-backed export finance to Russia and Belarus.

Commercial insurance market Lloyd’s of London said it was looking to apply sanctions pressure on Russia through the cyber, aerospace and political risk insurance markets.

($1 = 0.9088 euros)

(Additional reporting by Francesco Canepa, Balazs Koranyi, Sinchita Mitra, Karin Strohecker and Lawrence White; Writing by Carolyn CohnEditing by Mark Potter)

---