The Central Bank officially announced the reorganization of Binbank

The Central Bank decided to sanitize Binbank and Rost Bank. This is stated in a press release from the Russian regulator on September 21.

“Within the framework of these measures, it is planned to participate in the Bank of Russia as the main investor using the funds of the consolidation fund of the banking sector,” the Central Bank said.

As emphasized in the Central Bank, in this case the moratorium is not introduced to satisfy the claims of creditors, the mechanism for converting creditors into shares (Bail-in) is not applied. Financial recovery will be in cooperation with the owners and management of banks.

Binbank, Growth Bank and other banks of the group - Binbank Didzhtal and Uralpavatbank - will continue to work as usual, they pointed out in the Central Bank. “The Bank of Russia will provide financial support to the banks of the group, guaranteeing the continuity of their activities,” the regulator’s press service added.

According to the deputy chairman of the Central Bank Vasily Pozdyshev, preliminary a “hole” in Binbank’s capital is estimated at 250-300 billion rubles. “But the temporary administration will give an accurate assessment,” Kommersant quotes his words.

On the evening of September 20, the main owner of Binbank Mikail Shishkhanov, in an interview with RBC, said that the Central Bank agreed to his request to sanitize the bank. According to Shishkhanov’s estimates, the healing process will take 3-8 months, while the old owners expect to save 25% in the capital of Binbank, and 75% will “go to the state”.

Shishkhanov called the main reason for the owners of Binbank to resort to the help of the Central Bank, “MDM Bank”, who had previously entered the banking group of a businessman. “I did not expect that there would be such bad assets in the MDM bank. Because when we entered, there was an understanding and an approved plan for healing, but ultimately the MDM, unfortunately, turned out to be many times more and worse than the portfolio than expected. Again, it was a falling market, ”he explained.

In mid -August, the management company Alpha Capital called Binbank, Otkritie, the Moscow Credit Bank and Promsvyazbank risky. Later, Alfa-Bank said that this is the “purely private opinion” of the Alpha Capital manager, which is not true. Two weeks later, the Central Bank announced that he would take care of the “discovery”. It will pass according to the same scheme as the healing of Binbank.