The PR department of the Bank of Russia reported it cancelled banking licenses held by Mezhbusinessbank (Moscow) and Vecombank (Kaluga).
The central bank noted that Mezhbusinessbank failed to forward in a timely manner reports to the Federal Service for Financial Monitoring about operations that are subject to mandatory supervision, pursued a risky credit policy and did not form any adequate reserves for possible loan losses. Furthermore, the lending institution provided the Bank of Russia with unreliable financial statements, did not fulfill the requirements with regard to the mandatory reserve ratio and also violated Russian currency laws. “From June till August 10 a group of residents, the bank’s clients, wired over Rub 7 bln in favor of non-residents under suspicious goods transactions as advance payments. Money under such deals was wired mainly to several British companies that hold bank accounts in Latvia," the press release emphasized.
As Vecombank pursued the risky lending policy, it became insolvent and failed to timely fulfill its obligations to creditors and deposit holders, CBR emphasized. Furthermore, the lending institution broke mandatory ratios and did not comply with accounting regulations.
Temporary administration teams commenced operations at both banks until a bankruptcy manager or a liquidator is appointed. In accordance with the federal laws the powers and authority of the lending institutions’ executive bodies were suspended.
The central bank’s press service noted that Vecombank is a member of the national deposit insurance system and a revoked license is an accident insured.
