On revocation of banking licence and appointment of provisional administration
On 23 June 2014, the Bank of Russia issued order No. OD-1459 to revoke a licence to perform banking operations from the Vladikavkaz-based open joint-stock company Investment Joint-Stock Bank DIG-BANK (registration number 2423) effective 23 June 2014.
The decision to apply a last resort sanction — to revoke a licence to perform banking operations — was made by the Bank of Russia following a failure of the credit institution to observe the federal banking laws as well as the regulations of the Bank of Russia, established facts of seriously inaccurate reporting data, repeated violations within one year of the requirements envisaged by Article 7 (with the exception of Item 3 of Article 7) of the Federal Law ‘On Countering the Legalisation (Laundering) of Criminally Obtained Incomes and the Financing of Terrorism’, taking into account repeated application of supervisory measures within one year envisaged by the Federal Law ‘On the Central Bank of the Russian Federation (Bank of Russia)’.
The joint-stock company Investment Joint-Stock DIG-BANK carried out high-risk credit policy and did not establish loan loss provisions adequate to the risks taken. Following the loss of liquidity, the bank failed to timely meet its liabilities to the depositors. At the same time, the credit institution submitted to the Bank of Russia seriously distorted reported data to conceal existence in its operations the grounds to prevent insolvency (bankruptcy). Besides, the joint-stock company Investment Joint-Stock DIG-BANK did not observe the regulations in terms of countering the legalisation (laundering) of criminally obtained incomes and the financing of terrorism as regards timely data delivery on the operations subject to obligatory control and proper identification of its clients to the authorized body. In 2013 and Q1 of 2014, the credit institution was involved in large-scale suspicious cash operations totaling
On 23 June 2014, the Bank of Russia issued order No. OD-1460 to appoint provisional administration to the joint-stock company Investment Joint-Stock DIG-BANK until a receiver has been appointed in accordance with the Federal Law ‘On Insolvency (Bankruptcy) of Credit Institutions" or a liquidator has been appointed in accordance with Article 23.1 of the Federal Law ‘On Banks and Banking Activities’. The powers of the executive bodies of the credit institution have been terminated as the federal laws require.
The joint-stock company Investment Joint-Stock DIG-BANK is a member of the deposit insurance system. The revocation of the licence to perform banking operations is interpreted as an insured event envisaged by Federal Law No. 177-F3 ‘On Insurance of Household Deposits with Russian Banks’ as regards the liabilities of the bank in terms of household deposits as stipulated in legislation.
As of 1 June 2014, the Investment Joint-Stock DIG-BANK ranked the 500th in terms of assets in the banking system of the Russian Federation.
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23.06.2014 00.00.00