UPDATE: Russian central bank cancels license of 3 small banks

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MOSCOW, Feb 26 (PRIME) -- The central bank has revoked the licenses from Moscow-based Milbank, ranking 342nd by assets, Bank Zerich in Oryol, 449th by assets, and Moscow’s Raschyotny Dom, ranking 654th, the authority said in a statement on Thursday.

Milbank had conducted highly risky credit policies and failed to create adequate reserves. The bank did not fulfill orders prohibiting some operations issued by the central bank to protect interests of depositors, it said.

Bank Zerich had inadequately assessed risks, while the quality of its assets was unsatisfactory. A realistic assessment of credit risks resulted in a full capital loss. Bank Zerich stopped operations earlier in February and did not fulfill its liabilities to creditors.

Raschyotny Dom conducted highly risky credit policies, investing in low-quality assets. A realistic assessment of the risks and asset valuation triggered circumstances requiring bankruptcy prevention measures. The bank was focused on transactions involving ghost companies.

Milbank and Bank Zerich are members of the deposit insurance system, which means that each depositor may receive up to 1.4 million rubles in compensation.

(76.3929 rubles – U.S. $1)

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