The Bank of Russia decided to revoke’s My Bank’s banking license as of January 31, the regulator’s press service reported.
As the regulator noted in the press release, the lending institution failed to comply with the laws which regulate banking activities and the regulator’s normative acts. It was also established that the bank submitted materially unreliable financial statements. Based on the Bank of Russia’s data, My Bank pursued a high-risk credit policy, providing loans that generated no cash flows. Due to the loss of liquidity the lender failed to timely fulfill its obligations to its creditors or deposit holders.
In addition, the bank’s executives and owners failed to create economic conditions to attract the Deposit Insurance Agency (DIA) to rehabilitate the lending institution, and as there were prospects to restore the bank’s financial standing it was decided to revoke the license.
My Bank initially faced problems in mid-December 2013. To begin with, the lending institution imposed restrictions on withdrawals from deposit accounts and cash withdrawals from ATMs. Later the bank ceased to provide clients with money or open new accounts, including deposit accounts.
Based on the Banki.ru data, the financial institution violated CBR’s normative acts several times. Specifically, by the beginning of 2014 the bank’s № 2 fell to 5.57%, while as of January 1, 2014 the bank’s № 3 did not rise above 20.8%.
Some media previously reported that CBR did not rule out rehabilitating My Bank. The idea to rescue the bank was lobbied by the lending institution’s renowned deposit holders such as movie director Nikita Mikhalkov and presidential aide Sergei Glaziev.
The Bank of Russia appointed a temporary administration team at My Bank until a bankruptcy receiver or a liquidator is appointed. The powers and authority of the lending institutions’ executive bodies were suspended.
My Bank is a member of the national deposit insurance system and the cancelled license is an accident insured, CBR noted.
