On revocation of banking licence from Russky Natzionalny Bank and appointment of provisional administration
By Order No. OD-1434, dated 06.06.2018, the Bank of Russia revoked the banking licence of the Rostov-on-Don-based credit institution Limited bank Russky Natzionalny Bank, or Ltd. Russky Natzionalny Bank (Registration No. 469) from 06.06.2018. According to its financial statements, as of 01.05.2018, the credit institution ranked ranked 339th by assets in the Russian banking system.
The business model of Ltd. Russky Natzionalny Bank was largely designed to serve the interests of its owners. Lending to borrowers directly or indirectly related to the ultimate beneficiaries of the credit institution resulted in the considerable amount of non-performing assets in the credit institution’s balance sheet, including assets accounted for at overstated cost. Additionally, the bank conducted non-transparent operations on a regular basis. Those were aimed at masking credit risks assumed in order to comply with prudential requirements in a formal way.
The Bank of Russia repeatedly applied supervisory measures against Ltd. Russky Natzionalny Bank, including two impositions of restrictions on household deposit taking.
The credit institution’s management and owners failed to take effective measures to normalise its activities. Under the circumstances, the Bank of Russia took the decision to withdraw Ltd. Russky Natzionalny Bank from the banking services market.
The Bank of Russia takes this 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, due to repeated application within a year of measures envisaged by the Federal Law ‘On the Central Bank of the Russian Federation (Bank of Russia)’, considering a real threat to the creditors’ and depositors’ interests.
By its Order No. OD-1435, dated 06.06.2018, the Bank of Russia appointed a provisional administration to Ltd. Russky Natzionalny Bank for the period until the appointment of a receiver pursuant to the Federal Law ‘On the 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 were suspended.
Ltd. Russky Natzionalny Bank is a member of the deposit insurance system. The revocation of the banking licence is an insured event as stipulated by Federal Law No.
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