The answer to the question is YES because over the last few years the number of active credit institutions (banks and non-bank credit institutions) has reduced from 1058 in 2009 to 733 in 2015. The increase trend of liquidated organizations became especially noticeable after 2013: 89 credit institutions were liquidated in 2014 and 101 – in 2015; in most cases the reason for the liquidation was the revocation of a license.
Among the reasons of revocation of credit institutions’ banking licenses are:
- Non-execution of the Federal Laws and the Bank of Russia statutory enactments, regulating banking activity;
- Numerous violation of requirements, established by articles 6 and 7 of the Federal Law № 115-FZ «On countering the legislation of illegal earnings (money laundering) and the financing of terrorism»;
- Inability to satisfy requirements of creditors under monetary obligations within 14 days from the date of their satisfaction;
- Decrease in own funds (capital) below the minimum value of authorized capital (as of the date of state registration of the credit institution);
- Ascertainment of the facts of substantial unreliability in reporting data;
- Capital adequacy ratio (standard value Н0) is lower than 2% etc.
Among the main reasons of license’s revocation are: money laundering, loss of capital and fraud. Frequent cases of identifying of unreliable banks confirm the necessity to check the bank, which holds the counterparty’s accounts, while it’s reviewing. If worse comes to worst, in case of bank’s liquidation the counterparty may completely lose its funds. This case will lead to failure of contractual obligations and may cause the significant damage to a business.
Information and analytical system Globas-i® (http://www.credinform.ru/en-US/globas) can be used to check the counterparty’s bank, in particular: license availability, participation in S.W.I.F.T. and deposit insurance systems; to estimate the development of branch network; to compare bank’s indicators with mandatory standards, established by the Central Bank of Russia; to review the cash flows, assets value, cases of nonfulfillment of obligations, participation as a defendant in arbitration cases, negative information.
Based on the analysis of available information, Globas-i® system generates «Financial stability index of a credit institution». This is an independent assessment of the reliability and financial stability of a credit institution; it takes into account key performance indicators, regulatory compliance, established by the Central Bank of Russia, and quality indicators.