On revocation of banking licence of credit institution Bank Red Gates and appointment of provisional administration

By its Order No. OD-4838, dated 29 December 2016, the Bank of Russia revoked the banking licence from the Moscow-based credit institution Joint-Stock Commercial Bank Red Gates, or JSCB Bank Red Gates (JSC) (Registration No. 2472) from 29 December 2016.

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 and because of the application of measures envisaged by the Federal Law ‘On the Central Bank of the Russian Federation (Bank of Russia)’, taking into account the real threat to the interests of creditors and depositors.

JSCB Bank Red Gates (JSC) conducted high-risk lending policy by placing funds in low-quality assets. A proper assessment of the risks assumed created grounds for initiating measures to prevent insolvency (bankruptcy) by the credit institution. Moreover, due to loss of liquidity, the bank failed to timely fulfill its liabilities to creditors. The management and owners of the bank did not take effective measures to bring its activities back to normal and under such circumstances the Bank of Russia decided to remove JSCB Bank Red Gates (JSC) from the banking market.

By its Order No. OD-4839, dated 29 December 2016, the Bank of Russia appointed a provisional administration to JSCB Bank Red Gates (JSC) 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 are suspended.

JSCB Bank Red Gates (JSC) is a member of the deposit insurance system. The revocation of the banking licence is an insured event as stipulated by Federal Law No. 177-FZ ‘On the Insurance of Household Deposits with Russian Banks’ in respect of the bank’s retail deposit obligations, as defined by law. The said Federal Law provides for the payment of indemnities to the bank’s depositors, including individual entrepreneurs, in the amount of 100% of the balance of funds but no more than 1.4 million rubles per depositor.

According to the financial statements, as of 1 December 2016, JSCB Bank Red Gates (JSC) ranked 275th by assets in the Russian banking system.

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29.12.2016 00.00.00