The Central Bank of the Russian Federation (Bank of Russia)
12 Neglinnaya Street, Moscow, 107016 Russia;
On revocation of banking licence from LIGHTBANK and appointment of provisional administration
By Order No. OD-775, dated 29.03.2018, effective from the same date, the Bank of Russia revoked the banking licence of the Moscow-based credit institution Commercial Bank LIGHT, or LIGHTBANK (Registration No. 3177), further referred to as the credit institution. According to its financial statements, as of 01.03.2018, the credit institution ranked 425thby assets in the Russian banking system.
The problems in LIGHTBANK’s business owe their origin to a high risk model of its retail lending operations. Besides, the bank has failed to properly assess its credit portfolio quality. The due diligence check of credit risk established a substantial loss of capital and entailed the need for action to prevent the credit institution’s insolvency (bankruptcy); there arose a real threat to its creditors’ and depositors’ interests.
The Bank of Russia repeatedly applied supervisory measures to the credit institution, including the imposition of restrictions and a ban on household deposit taking.
The credit institution’s management and owners failed to take effective measures to normalise its activities. Under the circumstances the Bank of Russia took the decision to withdraw Commercial Bank LIGHT from the banking services market.
The Bank of Russia takes this measure following the credit institution’s failure to comply with federal banking laws and Bank of Russia regulations, due to repeated application within a year of measures envisaged by the Federal Law ‘On the Central Bank of the Russian Federation (Bank of Russia)’, considering a real threat to the creditors’ and depositors’ interests.
Following banking licence revocation, in accordance with Bank of Russia Order No. ОD-775, dated 29.03.2018, Commercial Bank LIGHT’s professional securities market participant licence was revoked.
By its Order No. OD-776, dated 29.03.2018, the Bank of Russia appointed a provisional administration to Commercial Bank LIGHT 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 have been suspended.
Commercial Bank LIGHT 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 a total of 1.4 million rubles per depositor.
29 March 2018
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