Moscow - The Central Bank of Russia has banned several divisions of Ukrainian banks from doing business in Crimea and Sevastopol due to failure to honor liabilities to creditors or depositors, the Central Bank said in a press release.
The ban extends to isolated structural divisions of Kharkiv-based Golden Gate Bank and Kyiv-based Neos Bank and Credit Agricole Bank.
“The termination of the activity of isolated structural divisions of the said credit institutions means that they are prohibited from conducting banking and other operations, except for operations connected with the transfer of assets and liabilities, on the territory of the Republic of Crimea and on the territory of the federal city of Sevastopol,” the Central Bank said.
“The decision… serves as a ground for the autonomous non-profit organization Depositor Protection Fund to acquire the rights (claims) on deposits and to make compensation payments in compliance with the procedure stipulated by the Federal Law on the Protection of Interests of Households Having Deposits with Banks and Isolated Structural Divisions of Banks Registered and (or) Operating on the Territory of the Republic of Crimea and on the Territory of the Federal City of Sevastopol (Federal Law No. 39-FZ).
In accordance with the law, the Central Bank has notified the autonomous non-profit organization Depositor Protection Fund about the grounds to acquire by the latter the rights (claims) on deposits placed with the structural divisions of these banks.
“The decision on the termination of the activity of the Ukrainian banks’ divisions was prompted primarily by the task to protect the interests of depositors and customers whose legitimate rights had been violated, including as a result of the actual suspension of work of these banks’ divisions in the Republic of Crimea and the federal city of Sevastopol, as well as the lack of prospects for resuming their activity. As a result, there was not any other opportunity to ensure an effective protection of the rights of depositors and customers of these banks living (engaged in economic activities) on the said territories, except for terminating the activity of the bank’s division. Civil legal claims to the aforementioned banks, including those on the part of the Depositor Protection Fund, will be considered, if necessary, by the competent judicial bodies under the generally established procedure.”
