Press Service

On revocation of banking licence from New Industrial Bank and appointment of provisional administration

By its Order No. OD-2023, dated 03.08.2018, the Bank of Russia revoked the banking licence from the Moscow-based credit institution Joint-stock Company New Industrial Bank or JSC New Industrial Bank (Registration No. 930) from 03.08.2018. According to its financial statements, as of 01.07.2018, the credit institution ranked 441^st by assets in the Russian banking system. The bank is not a member of the deposit insurance system.

Problems in the credit institution’s operations owe its origin to the use of an excessively risky business model, which resulted in multiple low-quality assets building up on its balance sheet. At the same time, the bank conducted ‘scheme’ transactions with its owners aimed at concealing its real financial standing while formally complying with the prudential regulations of the Bank of Russia. Also, the credit institution’s operations were found non-compliant with the requirements of Bank of Russia regulations on countering the legalisation (laundering) of criminally obtained incomes and the financing of terrorism. Moreover, the credit institution was involved in dubious transit operations.

The Bank of Russia had repeatedly (3 times over the last 12 months) applied supervisory measures against JSC New Industrial Bank.

However, the management and owners of the credit institution failed to take effective measures to cease dubious and ‘scheme’ transactions and normalise the bank’s activities. Under these circumstances, the Bank of Russia took the decision to revoke JSC New Industrial Bank’s banking licence.

The Bank of Russia took this measure following the credit institution’s failure to comply with federal banking laws and Bank of Russia regulations, repeated violations, within a year, of Bank of Russia regulations issued in accordance with the Federal Law ’On Countering the Legalisation (Laundering) of Criminally Obtained Incomes and the Financing of Terrorism’, and multiple applications within one year of measures stipulated by the Federal Law ’On the Central Bank of the Russian Federation (Bank of Russia)’.

By its Order No. OD-2024, dated 03.08.2018, the Bank of Russia appointed a provisional administration to the credit institution 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.