The Central Bank of Russia has revoked as of May 12, 2016 a banking license held by Bank Vek (Registration No. 2299), the regulator's press service reported.
The Bank of Russia explained its license-revoking decision by the lending institution's failure to comply with federal banking laws and also its statutory acts, because capital adequacy ratios fell below 2%, and equity (capital) declined below the minimum amount of the charter capital as established on the date of a lending institution's state registration, and taking into account the multiple application during the year of the measures provided for in the Federal Law "On the Central Bank of the Russian Federation (Bank of Russia)".
"While holding weak quality assets, Joint Stock Commercial Bank Vek assessed related risks inadequately. The proper assessment of the credit risk at the request of a supervisory body showed that the bank's equity (capital) was fully lost. The lending institution's executives and owners took no efficient measures to normalize its activities," the Bank of Russia noted.
Bank Vek is a member of the national deposit insurance system.
Last week, a Banki.ru source said that the Bank of Russia cut Bank Vek off the Banking Electronic Speedy Payment (BESP) system. The regulator's press service previously reported that Bank Vek violated the core capital adequacy ratio (N1.1) in the aggregate for six or more business days during 30 straight business days.
In March 2016, Bank Vek violated for two days the capital adequacy ratio (N1), core and primary capital adequacy ratios (N1.1, N1.2), the current liquidity ratio (N3), the ratio of the highest amount of high credit risks (N7), and also within a day the lending institution did not comply with the ratio of the highest amount of credits, bank guarantees and sureties provided by the bank to its participants (N9.1).
As Banki.ru wrote, due to a glitch Bank Vek suspended in April all payments and the payment of deposits. Experts of the Banki.ru information & analytical service pointed to a sharp decline in the bank's credit portfolio quality. While overdue debt remained intact (4.26% as of April 1, 2016), the lending institution's reserves jumped from 9.73% as of January 1 to 23.42% as of April 1.
