On Monday, August 18, the Bank of Russia has cancelled the licenses held by Ecoprombank, Art-Bank and non-lending institution Settlement Banking Center.
As the regulator noted in a press release, Ecoprombank pursued a high-risk lending policy related to the investment of funds in poor quality assets. Due to the unsatisfactory asset quality the bank failed to meet its obligations to the creditors and deposit holders on time.
For the record, in late July Ecoprombank announced a large-scale withdrawal of deposits after an information attack. After this the acceptable of new deposits and the support of bank cards were suspended. The lending institution assured that its executives were acting to add liquidity, in particular, by finding a buyer for its credit portfolio. Meanwhile, the Perm-based media reported about the possible sale of a controlling interest in Ecoprombank, with three banks and two investment firms named as contenders.
Art-Bank, based on the regulator’s data, pursued a high-risk lending policy and failed to form adequate risk-weighted reserves against loan losses. Moreover, the bank failed to timely fulfill its obligations to the creditors and provided the Bank of Russia with materially unreliable financial statements.
This March the regulator sent a request to Art-Bank demanding to present a petition as to cease the right to deal with deposit accounts. On April 14, 2014 Art-Bank’s license to draw retail funds in rubles and foreign currencies became effective.
As the Bank of Russia specified, settlement non-lending institution Settlement Banking Center failed to comply with the requirements of the laws on counteraction of legalization of criminal income and proper actions to identify clients. According to CBR’s data, throughout 2013 the lending institution was involved in suspicious operations related to the transfer of funds abroad for a total of over Rub 8 bln.
The media wired this spring that Soyuzprombank, KIP-Bank and also non-lending institutions Center for Inter-bank Settlements and Settlement Banking Center announced their reorganization in the form of a merger, and an under-establishment institution would be called Businessprombank. KIP-Bank’s license was revoked on August 8, 2014.
The payment of the money to Ecoprombank and Art-Bank deposit holders would begin no later than September 1, 2014, the State Depositary Insurance Agency (DIA) said in a press release.
