On revocation of banking licence from credit institution Krylovsky and appointment of provisional administration
By its Order No. OD-2190, dated 2 August 2017, the Bank of Russia revoked the banking licence from the Krasnodar-based credit institution Joint-stock Commercial Bank Krylovsky (Registration No. 456) from 2 August 2017. According to the financial statements, as of 1 July 2017, the credit institution ranked 360th by assets in the Russian banking system.
The credit institution’s resource base was mainly formed by borrowed household funds. In 2017, the bank pursued an aggressive household fund raising policy. The Bank of Russia has repeatedly applied supervisory measures to Joint-stock Commercial Bank Krylovsky, including restrictions (twice) and a prohibition (once) on household deposit taking.
On 26 July, in the course of the inspection of tills at several offices of Joint-stock Commercial Bank Krylovsky, the Bank of Russia revealed a large-value cash shortage. Creation of required loss provisions for actually missing assets revealed a full loss of capital by the credit institution.
The management and owners of the bank failed to take effective measures to normalise its activities. In addition, their behaviour was unscrupulous: they submitted unreliable statements to the Bank of Russia and withdrew assets to the detriment of creditors and depositors’ interests. The Bank of Russia will forward information about the mentioned facts to law enforcement authorities. Under these circumstances, the Bank of Russia performed its duty on the revocation of the banking licence from Joint-stock Commercial Bank Krylovsky in accordance with Article 20 of the Federal Law ‘On Banks and Banking Activities’.
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, because all capital adequacy ratios of this credit institution were below 2% and its equity capital dropped below the minimum authorised capital value established as of the date of state registration, and taking into account the repeated application within a year of measures envisaged by the Federal Law ‘On the Central Bank of the Russian Federation (Bank of Russia)’.
By its Order No. OD-2191, dated 2 August 2017, the Bank of Russia has appointed a provisional administration to Joint-stock Commercial Bank Krylovsky 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 have been suspended.
Joint-stock Commercial Bank Krylovsky 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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02.08.2017 00.00.00