The Central Bank wrote a “code of honor” for financiers

The Bank of Russia published and offered to discuss a draft code of good faith for financial market participants. The banks themselves asked about the etiquette or “code of honor” of the Central Bank after the story with Sergey Gavrilov from Alfa Capital.

More. The Central Bank wants every financial institution that has signed the code to note this on its website or on the website of an industry association. If she violates the principles of good faith behavior, the record of accession to the code is deleted.

There are seven principles in total:

1. Honesty , including "avoiding misrepresentation, false, unreasonable offers and assurances".
2. Fairness , including "equal treatment of investor rights and consumer rights".
3. Transparency , in particular, "providing reliable information to other financial institutions, consumers and the regulator".
4. Protection , including respect for customers and the protection of their personal data.
5. Professionalism , including the performance of duties "with due diligence, accuracy, reasonableness and independence, including in the exercise of professional judgment". Institutions are required to make decisions based on reliable information and use clear, precise and understandable language "in relations with other financial institutions, consumers and the regulator."
6. Responsibility not only for direct violations of the law, but also in relations with customers.
7. Integrity , including the prevention of actions that "worse the reputation of the financial market as a whole and individual financial institutions."

The Code is not a normative document and is advisory in nature.

Context. At the end of 2017, the Rossiya Banking Association proposed to the Central Bank to create a code of conduct for banks.

The main reason was the "Gavrilov incident" - a story with a letter from the manager of Alfa Capital about the dubious stability of four large banks - FC Otkritie, Binbank, MCB and Promsvyazbank. Three of them ended up being reorganized, and the Central Bank was forced to spend a huge amount on it - 2.8 trillion rubles ( estimate ). Kommersant's

In August 2017, Sergei Gavrilov, Director of Wealthy Client Relations at Alfa Capital Management Company, sent out a letter to clients stating that the fate of four large private banks would be decided in the fall. He recommended "distance from risk by transferring assets to more reliable participants in the banking system", and pointed out the particular danger of subordinated bonds.

After a huge scandal broke out, Alfa Capital called the letter Gavrilov's personal point of view, and later withdrew it. The analyst was called to the Central Bank, but he was not fired from Alfa. Mikhail Fridman, in an interview with Forbes , defended the manager, pointing out that he "acted like a normal person and told clients what he saw fit."

Nevertheless, Gavrilov was deprived of his bonus, and the expression "analyst Gavrilov" became a local meme.

The Central Bank conducted an investigation and found that the information in the letter about the closing of limits on the bonds of four banks by Alfa Capital was unreliable, and the company had no insider information.

There is no mechanism of responsibility for such letters in Russia, complained then the co-owner of the sanitized Promsvyazbank Dmitry Ananyev, who was later forced to leave Russia. It was he who proposed to the chairman of the Central Bank Elvira Nabiullina to introduce liability for dishonest actions to inform customers. The initiative found support from "Russia" and eventually culminated in the draft "banker's code of honor."