The Bank of Russia has approved a financial recovery plan for B&N Bank, which provides for additional capitalization of the bank and the provision of funds to it to maintain liquidity, the Central Bank of the Russian Federation said.
“The Bank of Russia has approved a plan for the Bank of Russia to participate in the implementation of measures to prevent the bankruptcy of B& N Bank , which provide for additional capitalization of the bank and the provision of funds to maintain liquidity, which will increase its financial stability and contribute to the further development of the credit institution,” the regulator said in a statement.
B&N Bank, which is in the top 12 in the Russian Federation in terms of assets, is now undergoing financial rehabilitation through the new Central Bank-controlled Fund for the Consolidation of the Banking Sector (FCBS). The Central Bank announced the reorganization of B&N Bank on September 21. Under the new reorganization mechanism, the Central Bank becomes the main owner of the rehabilitated banks with subsequent sale to a private investor.
Central Bank’s printing press will save Otkritie and B&N Bank
Earlier, on August 29, the Central Bank announced the reorganization of FC Otkritie, the first to use the FCBS mechanism.
On Wednesday, Deputy Chairman of the Central Bank Vasily Pozdyshev said that the funds of the FCBS, which were spent on reorganization, most likely could not be returned when the banks were sold. According to him, 800-820 billion rubles will be required for their financial recovery . In September, Pozdyshev estimated the size of the “hole” in the capital of FC Otkritie at 250-400 billion rubles, B&N Bank – at 250-350 billion rubles.