DIA to be temporary administration of financial institutions after their licences are revoked
In cases where a licence is revoked from a bank being a member of the deposit insurance system or from an insurance company, or a non-governmental pension fund dealing with mandatory pension insurance, the Bank of Russia will appoint the State Corporation Deposit Insurance Agency (DIA) as the provisional administration. The relevant amendments to the law became effective on 18 October 2021.
Previously, the Bank of Russia performed these functions after the revocation of a bank’s licence (with the possibility to engage DIA specialists), whereas the DIA carried out the liquidation of a financial institution after the court issued the corresponding ruling.
The DIA will exercise the provisional administration’s powers via a representative assigned from among DIA employees. Furthermore, the Bank of Russia will control the DIA’s work, including through inspections of the provisional administration’s activity.
By authorising the DIA to perform these new functions, the Bank of Russia streamlines the procedures for liquidating a financial institution and speeds up the creation of the register of creditors’ claims, the stock-taking and sale of the financial institution’s assets, and the formation of bankruptcy estate to make settlements with creditors.