27.02.2016, 01:59
Bank of Russia Revoked Licence from CB MILBANK LLC
OREANDA-NEWS. By its Order No. OD-672, dated 26 February 2016, the Bank of Russia revoked the banking licence from the Moscow-based credit institution Commercial Bank MILBANK, limited liability company, or CB MILBANK LLC (Registration No. 3256) from 26 February 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 application of supervisory measures envisaged by the Federal Law 'On the Central Bank of the Russian Federation (Bank of Russia)', given the real threat to creditors' and depositors' interests.
CB MILBANK LLC implemented high-risk lending policy and failed to create loan loss provisions adequate to the risks assumed. At the same time the credit institution failed to meet the supervisor's instructions on prohibiting certain operations designed to protect interests of the bank's depositors. The management and owners of CB MILBANK LLC did not take measures to normalise its activities.
By its Order No. OD-673, dated 26 February 2016, the Bank of Russia has appointed a provisional administration to CB MILBANK LLC 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.
CB MILBANK LLC 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 one depositor.
According to the financial statements, as of 1 February 2016, CB MILBANK LLC ranked 341st by assets in the Russian banking system.
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 application of supervisory measures envisaged by the Federal Law 'On the Central Bank of the Russian Federation (Bank of Russia)', given the real threat to creditors' and depositors' interests.
CB MILBANK LLC implemented high-risk lending policy and failed to create loan loss provisions adequate to the risks assumed. At the same time the credit institution failed to meet the supervisor's instructions on prohibiting certain operations designed to protect interests of the bank's depositors. The management and owners of CB MILBANK LLC did not take measures to normalise its activities.
By its Order No. OD-673, dated 26 February 2016, the Bank of Russia has appointed a provisional administration to CB MILBANK LLC 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.
CB MILBANK LLC 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 one depositor.
According to the financial statements, as of 1 February 2016, CB MILBANK LLC ranked 341st by assets in the Russian banking system.
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