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Bank of Russia revokes license from two banks

Russian Central Bank revokes license from IstKom-Finace bank and Fininvest bank.

The decision was made to the bank's failure to comply with the legislation on the banking activity and regulations of the Bank of Russia. The bank was unable to satisfy requirements from creditors, and besides the regulator has revealed inaccuracy in the bank's reports.

Due to lost liquidity, the bank could not offer timely services to its clients, and at the same time the bank sent to the Bank of Russia very inaccurate reports, which were concealing reasons for measures to prevent bankruptcy and revoking of the license. Top management and owners of the credit organisation did not undertake necessary measures to restore the bank's activities.

During 2013 and the first quarter of the current year, the bank was involved in doubtful operations, which totalled about 14 billion roubles.

The Central Bank has appointed temporary administration.

The IstKom-Finance Bank is a participant of the deposits' insurance system.

Deposits' Insurance Agency to begin insurance payments to clients of Fininvest, Eurosib, IstKom-Finance banks no later July 21.

Overall, the Russian monetary and financial regulator has revoked licenses from 39 banks since the start of the year to cut their number to less than 900.

Russian President Vladimir Putin earlier said in response to a journalists' question that license revocations were intended to improve the country's financial system and free it from financial institutions that could not fulfill their obligations to depositors and work efficiently and posed a risk to the entire banking system.

[Source: Itar Tass, Moscow, 07Jul14]

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