On the revocation of banking licence and appointment of provisional administration
By Order No. OD—326, dated 18 March 2014, the Bank of Russia revoked the banking licence of the Moscow-based Open Joint Stock Company Commercial Bank Stroykredit (CB Stroykredit, OJSC) from 18 March 2014.
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 of the established facts of gross misreporting of data, and also taking into account the repeated application over the past year of measures envisaged by the Federal Law ‘On the Central Bank of the Russian Federation (Bank of Russia)’.
CB Stroykredit, OJSC pursued highly risky policies and did not create proper and consistent with assumed risks loan loss provisions and provisions for other assets. The credit institution made significant investments in the unit investment fund, which investments were accounted for at overestimated prices. Besides, CB Stroykredit, OJSC did not comply with the supervisor’s orders to reflect its actual financial condition in the accounting and reporting. Due to the above, the bank’s reported data submitted to the Bank of Russia were materially false.
The executives and owners of the credit institution did not take effective measures to normalise its activities.
In pursuance of Bank of Russia Order No. OD—327, dated 18 March 2014, a provisional administration has been appointed to CB Stroykredit, OJSC for a term until the appointment of a receiver in accordance with the Federal Law ‘On the Insolvency (Bankruptcy) of Credit Institutions’ or a liquidator in accordance with Article 23.1 of the Federal Law ‘On Banks and Banking Activities’. In compliance with federal laws the powers of the credit institution’s executive bodies have been suspended.
CB Stroykredit, OJSC is a participant in the deposit insurance system. The revocation of the banking licence is recognised as an insured event stipulated by Federal Law No. 177‑FZ ‘On the Insurance of Household Deposits in Russian Banks’ with regard to the bank’s obligations to honour household deposits identified in accordance with the procedure established by law.
As of 1 March 2014, CB Stroykredit, OJSC ranked 180th in the Russian banking system in terms of assets.The reference to the Press Service is mandatory if you intend to use this material.
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