MOSCOW, Feb 20 (PRIME) -- Russia’s central bank could introduce an interim administration at Orient Express Bank and take measures to prevent the bank’s bankruptcy upon results of a comprehensive audit that took place six months before the arrest of investment company Baring Vostok founder Michael Calvey, business daily Vedomosti reported Wednesday.
The Basmanny District Court of Moscow earlier arrested Calvey and five other defendants over alleged 2.5 billion ruble embezzlement from Orient Express Bank.
“The central bank completed a planned comprehensive audit of Orient Express Bank on August 30, 2018... Conclusion: the central bank could have grounds for taking measures to prevent the bankruptcy of Orient Express Bank and introduce an interim administration at it,” the publication said citing the verification act.
The audit revealed that the share of corporate loans at the bank grew to 23% from 3% after a merger with Uniastrum Bank, which significantly increased loan risks. Lack of reserves on corporate portfolio could amount to 10.6 billion rubles then.
But if the bank had created all necessary reserves then, it would have violated six mandatory ratios, including those connected with capital adequacy.
“The central bank also believes that Orient Express Bank unjustifiably restructured a loan to First Collection Bureau, which is also co-owned by Baring: the money was spent on high risky assets – the purchase of portfolios of bad debts of individual clients,” the daily reported.
The central bank also checked Orient Express Bank’s investments in securities: for eight issuers, the risk assessment of investing in stocks was considered inadequate. Among them is International Financial Technology Group (IFTG), the regulator said.
“The claims of (Sherzod) Yusupov and a subsequent arrest of four employees of Baring Vostok, as well as former CEO of Orient Express Bank Alexei Kordichev and First Collection Bureau CEO Maxim Vladimirov were connected with investments in shares of precisely this company,” the daily said.
(66.2022 rubles – U.S. $1)
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