06.05.2016, 09:46
On Revocation of Banking Licence from Mostransbank
OREANDA-NEWS. By its Order No. OD-1408, dated 5 May 2016, the Bank of Russia revoked the banking licence from the Moscow-based credit institution Joint-Stock Commercial Bank Passenger Transport Enterprises Development of Moscow Mostransbank (open joint-stock company) or JSCB Mostransbank OJSC (Registration No. 2258) from 5 May 2016.
The Bank of Russia took such an extreme measure - revocation of the banking licence - because of the credit institution's failure to comply with federal banking laws and Bank of Russia regulations, and application of supervisory measures envisaged by the Federal Law 'On the Central Bank of the Russian Federation (Bank of Russia)', given the real threat to the creditors' and depositors' interests.
JSCB Mostransbank OJSC invested funds in low-quality assets and failed to create provisions adequate to the risks assumed. Due to the unsatisfactory quality of assets which failed to generate sufficient cash flow, the credit institution faced reasons for implementing insolvency (bankruptcy) prevention measures. The management and owners of the bank did not take measures to normalise its activities.
By its Order No. OD-1409, dated 5 May 2016, the Bank of Russia has appointed a provisional administration to JSCB Mostransbank OJSC for the period until the appointment of a receiver pursuant to the Federal Law 'On Insolvency (Bankruptcy)' or a liquidator under Article 23.1 of the Federal Law 'On Banks and Banking Activities'. In accordance with federal laws, the powers of the credit institution's executive bodies are suspended.
JSCB Mostransbank OJSC is a member of the deposit insurance system. The revocation of banking licence is an insured event envisaged by Federal Law No. 177-FZ 'On Insurance of Household Deposits with Russian Banks' regarding the bank's obligations on deposits of households determined in accordance with the legislation. This Federal Law provides for the payment of insurance indemnity to the bank's depositors, including individual entrepreneurs, in the amount of 100% of their balances but not exceeding the total of 1.4 million rubles per depositor.
According to the financial statements, as of 1 April 2016, JSCB Mostransbank OJSC ranked 538th by assets in the Russian banking system.
The Bank of Russia took such an extreme measure - revocation of the banking licence - because of the credit institution's failure to comply with federal banking laws and Bank of Russia regulations, and application of supervisory measures envisaged by the Federal Law 'On the Central Bank of the Russian Federation (Bank of Russia)', given the real threat to the creditors' and depositors' interests.
JSCB Mostransbank OJSC invested funds in low-quality assets and failed to create provisions adequate to the risks assumed. Due to the unsatisfactory quality of assets which failed to generate sufficient cash flow, the credit institution faced reasons for implementing insolvency (bankruptcy) prevention measures. The management and owners of the bank did not take measures to normalise its activities.
By its Order No. OD-1409, dated 5 May 2016, the Bank of Russia has appointed a provisional administration to JSCB Mostransbank OJSC for the period until the appointment of a receiver pursuant to the Federal Law 'On Insolvency (Bankruptcy)' or a liquidator under Article 23.1 of the Federal Law 'On Banks and Banking Activities'. In accordance with federal laws, the powers of the credit institution's executive bodies are suspended.
JSCB Mostransbank OJSC is a member of the deposit insurance system. The revocation of banking licence is an insured event envisaged by Federal Law No. 177-FZ 'On Insurance of Household Deposits with Russian Banks' regarding the bank's obligations on deposits of households determined in accordance with the legislation. This Federal Law provides for the payment of insurance indemnity to the bank's depositors, including individual entrepreneurs, in the amount of 100% of their balances but not exceeding the total of 1.4 million rubles per depositor.
According to the financial statements, as of 1 April 2016, JSCB Mostransbank OJSC ranked 538th by assets in the Russian banking system.
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