CBR installs temporary administration at Jugra Bank due to shaky finances
MOSCOW. July 10 (Interfax) - The Central Bank of Russia has installed a temporary administration in the person of the Deposit Insurance Agency (DIA) at Jugra Bank , one of Russia's top 50 lenders, due to its unstable financial condition and threats to the interests of creditors and depositors, the CBR said.
The authority of the bank's shareholders related to participation in charter capital, as well as the authority of its management bodies will be suspended for the duration of the temporary administration, which has been imposed for six months.
The temporary administration's first order of business is to audit the bank's financial position.
The CBR has also imposed a moratorium on meeting the claims of Jugra Bank's creditors for three months effective July 10. Under the law, the imposition of a moratorium is an insured event. Payments to Jugra depositors, including individual entrepreneurs, will begin within 14 days of the imposition of the moratorium. The procedure for payment of insurance will be determined by the DIA.
The DIA said agent banks would be selected by tender not later than July 17 and payments would begin before July 24.
Jugra is part of the deposit insurance system. As of March 31, according to reporting to International Financial Reporting Standards (IFRS) it held 196.8 billion rubles in client funds - 182.9 billion rubles or 92.9% of it the funds of individuals. Its credit portfolio before provisions totaled 273.9 billion rubles, and almost all of it (273.4 billion rubles) consisted of corporate loans.
The Vedomosti newspaper has quoted sources as saying that in the second half of May, Jugra received a recommendation from the Central Bank to create more than 40 billion rubles in additional provisions, but the bank did not at the time confirm it had received the recommendation.
Jugra has been in the process of converting $385.5 million in subordinated deposits from Switzerland's Radamant Financial AG from additional capital into core capital. It plans to top its core capital up by $500 million, partly by converting nearly all subordinated deposits it has attracted in the past.
Also, the shareholders have been trying to transfer 86.8% of the bank's shares to the books of a new company, JSC Direct Investments, and have filed the relevant request with the Central Bank. However the regulator recommended that the shareholders first obtain clearance for this from the Federal Antimonopoly Service (FAS), which has approved the deal.
Radamant Financial, controlled by Alexei Khotin, owned 52.43% of Jugra. Khotin owned 0.48% of the bank directly. Other shareholders included the general director of United Construction Group, Maiya Alandzhi - 9.41%, Yelena Laikova - 7.39%, Vera Yesionova - 7.09%, Natalya Ivanova - 6.37%, Yelena Belousova - 3.72%, Mikhail Grebeshev - 2.57%, Dmitry Maximov - 2.12%, Alexander Lemeshko - 2.05%, Irina Lyubeznova - 1.15%, Igor Burdayev - 1.05%, Yury Gusev - 0.00098% and Alexei Nefedov - 0.00024%.
Jugra Bank was registered in Megion in 1990, but in November 2016 the bank re-registered in Moscow. Jugra was Russia's 33rd largest bank by assets and 12th by retail deposits at the end of the first quarter of 2017, according to the Interfax-100 ranking of the country's lenders.