The Bank of Russia has decided to revoke a banking license held by Probusinessbank, the regulator said in a press release.
To remind, the bank was a core of financial group Life.
The bank's license has been revoked since August 12, 2015. The Bank of Russia decided to apply the measure of last resort as the lending institution failed to execute federal laws regulating banking activities and CBR's statutory acts, the bank's capital adequacy ratios dropped below 2%% and equity (capital) fell below its minimum charter capital as established on the date of its state registration, and taking into account the application of the measures provided for in the federal law "On the Central Bank of the Russian Federation (Bank of Russia)," the regulator said in a press release.
The Bank of Russia specified that Probusinessbank pursued a high-risk lending policy by investing the money in poor quality assets. "Upon formation of provisions adequate to the accepted risks the lending institution fully lost its equity (capital)," the regulator concluded. As the Bank of Russia said, the bank's executives and owners took no efficient measures to bring its activities back to normal.
Along with the decision to cancel Probusinessbank's license the Bank of Russia approved a plan for the Deposit Insurance Agency (DIA) to take part in measures to settle the lending institution's obligations. The agency is expected to hold a tender to select a bank that will buy some of Probusinessbank's property and liabilities. One of the requirements for bidders will be the ability to start serving the bank's deposit holders at the points of its presence (or in the same localities) no later than 14 days upon approval of the plan for DIA to take part in measures to settle Probusinessbank's obligations.
The Bank of Russia also specified that the DIA was authorized to act as Probusinessbank's temporary administration.
