By Laurence Norman and Matina Stevis

BRUSSELS--European Union-based subsidiaries of Russian state-owned banks are exempt from EU sanctions, two European officials said Wednesday.

The exemption was added in the last few days before the sanctions--which include bans on buying equity and longer-term debt from banks that have more than 50% Russian state ownership-- were passed Tuesday, the officials said.

EU officials have said that five state-owned banks and their non-EU subsidiaries would be covered by the sanctions, including Sberbank and VTB Bank. The official list of the banks targeted will be published later this week.

Russia's VTB Bank has subsidiaries in Austria and Cyprus, while Sberbank has a subsidiary in Austria.

Write to Laurence Norman at laurence.norman@wsj.com and Matina Stevis at matina.stevis@wsj.com