On suspending licence of professional participant of securities market

On 21 August 2014, the Bank of Russia took a decision to suspend the licence to carry out broker, dealer and depositary activity and operations to manage securities of Universal Investment Company Partner, limited liability company (hereinafter, the Company), professional participant of the securities market, till 30 September 2014.

The reasons to take this decision were repeated violations within a year of the requirements of the Russian securities law, notably:

The Company included overdue accounts receivables on loan agreement in its own funds;

The value of the Company’s own funds for the period from 31 October 2012 till 31 March 2014 did not meet the capital adequacy ratio established by the Russian securities law;

The Company provided unreliable information in its quarterly report of the professional participant of the securities market under form No. 1100 for 2014 Q1;

The Company failed to meet the requirements of the Russian legislation for the separate keeping of cash assets contractually transferred for brokerage and cash assets under trust management;

Acting in the capacity of an asset manager, the Company entered into the securities purchase contract with the third party providing the acquisition of securities at the trustors’ expense when the cash assets under trust management were insufficient to meet the obligations under the contract. The Company also used the trustors’ property in order to meet its liabilities under the loan agreement;

The Company transferred the customer’s property under the brokerage agreement to the property under the trust management and the property under the trust management into the customer’s property under the brokerage agreement;

The Company transferred the items under trust management owned by the trustors to the property of the Company’s affiliated party;

The company’s report for trust management customers lacked the calculation of trust manager’s fee;

The Company transferred property under trust management under the agreements providing for deferred payment or payment by installments for over 90 calendar days. At the same time, the trust management agreement did not stipulate the term in which the parties had to communicate their withdrawal from the trust management agreement.

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25.08.2014 00.00.00