The Central Bank of Russia has revoked as of May 12, 2016 a banking license held by Dynamic Systems Bank (Registration No. 3439), the regulator's press service reported.
The Bank of Russia explained its decision to take the last-resort measure because the lending institution failed to fulfill federal banking laws and also CBR's statutory acts, facts were identified that the bank provided unreliable financial data, 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)" given a real threat to the interests of its creditors and deposit holders.
DS-Bank pursued a high-risk credit policy, investing funds in weak quality assets. Meanwhile, the bank did not fulfill demands of a supervisory body as to compile required loan loss provisions, to provide reliable financial statements that reflect its real financial standing and the presence of reasons for measures to prevent insolvency (bankruptcy). Since early May 2016 the bank has virtually ceased operations. Furthermore, the lending institution was involved in suspicious transit operations," the Bank of Russia claimed.
The media wired last week that Dynamic Systems Bank temporarily stopped the service of corporate customers. A Banki.ru source earlier said that the Bank of Russia cut Dynamic Systems Bank off the Banking Electronic Speedy Payment (BESP) system.
In January-March 2016, the bank's assets climbed by more than a third to Rub 1.7 bln. Meanwhile, the credit portfolio shrank 5% to Rub 423.4 mln as of April 1, 2016. The bulk of the bank's assets fell to high-liquidity assets (Rub 566 mln). High-liquidity assets include cash in hand and nostro accounts. During the specified period overdue debt at Dynamic Systems Bank rose by more than 8.5% to 9.01%. At the same time, loan loss provisions are slightly above 10%, up 4.3% since January.
