As of December 13, 2013 the Bank of Russia revoked banking licenses held by Project Financing Bank (Registration No. 1677) and Investbank (Registration No. 107), materials posted on the regulator’s website run.
As Banki.ru previously reported, since December 10, 2013 PFB’s additional offices stopped serving clients and only 4 units were operational, advising clients. The bank expected to be provided with a loan by CBR, as well as a decision of the regulator’s check commission, a meeting of which was to end till January 18. PFB management board chairman Sergei Mys also told the banking portal that the bank began to look for a buyer for its credit portfolio.
Investigative actions were taken against Investbank’s clients on December 10, with documents seized at the lending institution’s head office. As Investbank told Banki.ru, investigators seized documents related to the activities of businesses. News broke on Thursday night that panic of deposit holders forced the bank to suspend client services in Kaliningrad.
As the Bank of Russia’s press service reported, due to the loss of liquidity in late November PFB virtually ceased its activities. The regulator thinks that there was a real threat for the bank’s creditors and deposit holders. Because of the bank’s high-risk credit policy PFB’s asset quality was poor, while financial statements did not reflect accepted risks. Moreover, no provisions against possible loan losses were piled up.
The regulator also emphasized that PFB got involved in suspicious transactions.
As for Investbank, the Bank of Russia found out that the lending institution’s financial statements are unreliable, while the reliable reflection of the value of the bank’s assets points to the loss of equity. In addition, Investbank formed no adequate reserves against possible losses, while the lending institution’s management failed to take actions to get the bank’s activities back to normal.
The Bank of Russia thinks there were no options to restore Investbank’s financial standing. Due to this and not to turn things for the worse the regulator decided to revoke the bank’s license.
