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Russian regulator revokes three more licenses in banking sector restructuring

November 11, 2014, 12:10 UTC+3 MOSCOW

The regulator has revoked the licenses of Payment Service Bank based in Ufa, Gubernsky Bank Simbirsk located in Ulyanovsk and the Moscow-based Yevropeisky Ekspress

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Russian Central Bank

Russian Central Bank

© ITAR-TASS/Sergei Bobylev

MOSCOW, November 11. /TASS/. The Russian Central Bank has revoked three more banking licenses in a continued effort to restructure the country’s financial system, the regulator said on Tuesday.

The regulator has revoked the licenses of Payment Service Bank based in Ufa, the capital of the Urals Republic of Bashkortostan, Gubernsky Bank Simbirsk located in Ulyanovsk in the Volga area and the Moscow-based Yevropeisky Ekspress.

Payment Service Bank and Gubernsky Bank Simbirsk lost their licenses over risky lending policies and their failure to create adequate loan impairment provisions and meet their obligations to creditors on time, the regulator said in a statement.

Yevropeisky Ekspress was stripped of its license for dubious operations and the withdrawal of large amounts of money from Russia, the statement said.

The Russian Central Bank has taken active efforts lately to restructure the domestic financial system and make it stable and resilient to market shocks. The regulator has paid special attention to financial institutions that are not large in size and conduct risky operations and violate capital adequacy and transparency requirements.

The Russian regulator has revoked a total of 69 banking licenses since the start of this year, reducing the number of banking institutions in Russia to 865.

In 2013, the regulator stripped 32 banks of their banking licenses.

The Russian regulator has also applied financial rehabilitation measures to banks across the entire spectrum of the domestic banking rating system, including banks from the list of the top 100 domestic banking institutions by assets like Master Bank and Investbank, the top 200 banks like Smolensky Bank and Pushkino Bank and the top 300 credit institutions like Novokuznetsk Municipal Bank and European Trust Bank.

The large-scale effort to clean the banking sector of inefficient operators started with the appointment of Elvira Nabiullina as the Central Bank chief in June 2013.

The Central Bank head has said a decision on license revocation is an “extreme measure” when all the other methods of “influence on a particular bank have been used up.

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