The Bank of Russia has cancelled banking licenses held by Moscow-based Bank West and S-Bank, headquartered in Izhevsk, the PR department of the Bank of Russia reported. The regulator took this decision because on January 1, 2010 the lending institutions’ capitals did not meet the requirements of Article 11.2.5 of the Federal Law “On Banks and Banking Activities” (Rub 90 mln).
The Bank of Russia noted that the lenders’ executives took no efficient measures to comply with the legislative requirements when increasing equity (capital). The lending institutions did not apply to CBR seeking permission to re-register as non-banking lending institutions. Under the circumstances and in accordance with the Federal Law “On Banks and Banking Activity” the Bank of Russia exercised its duty to revoke the banking license.
Temporary administration teams were appointed for both banks until the appointment of receivers in accordance with the Federal Law “On Insolvency (Bankruptcy)” or liquidators in line with Article 23.1 of the Federal Law “On Banks and Banking Activity”. In accordance with the federal laws the powers and authority of the lending institutions’ executive bodies were suspended.
S-Bank is a member of the national deposit insurance system. The revocation of a banking license is an accident insured as provided for by Federal Law #177-FZ “On Insuring Household Deposits Held with Banks of the Russian Federation”.
