A month of bailout: the financial black hole of Otkrytie Bank reached 190 billion rubles

Under the terms of the Central Bank, the shareholders of FC Otkrytie will lose their rights to own the 25% stake promised to them after the financial recovery, if the interim administration reveals negative capital in the bank.
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The hole in the capital of FC Otkritie, which since August 29 has been cleared by the Central Bank of Russia through the Banking Sector Consolidation Fund (FCCC), amounted to almost 190 billion rubles. This is stated in the materials of the bank, posted on Tuesday, October 9, on the site of a single federal register of information on the facts of the activities of legal entities (Fedresurs).

"The value of the net assets of FC Opening" as of October 1, 2017 is minus 188 872 379 000 rubles, "the report said. The cost of the net assets of Bank Trust, which was reorganized since December 2014 by Otkrytie Bank, is also negative - 157.899 billion rubles, according to data from the Fedresses.

It should be recalled that at the end of December 2014 the Central Bank provided "FK Otkryt" for the rehabilitation of the bank "Trust" 127 billion rubles. A year later the bank asked the regulator for the rehabilitation of the Trust, an additional 50 billion rubles.

In total, in September 2017, the capital of FC Otkritie was reduced by 347 billion rubles, and Bank Trust - by 58.5 billion rubles. The Bank of Russia has been raising the financial stability of Otkritie Bank and Trust Bank since August 29 with the use of FCCC funds.

Alexander Dmitriev, Managing Director of FC Otkritie, explained in a comment sent to Forbes that the main reasons for reducing the size of Otkar Bank's own funds to negative values ​​are the creation of reserves, the negative revaluation of securities in the bank's portfolio, and the provision of free assistance to the subsidiary. Also on the size of the capital in September, according to him, the peculiarities of calculating the bank's own funds influenced the formation of their negative value. "After the capital became negative, the assets granted to shareholders and investments in financial institutions began to be deducted from it in full," Dmitriev explained.

He stressed that the reduction of capital to a negative value does not affect the bank's activities. Moreover, this is a natural action within the framework of the measures implemented by the Central Bank to increase its financial stability. "In addition, with a decrease in equity to a negative value, the size of the authorized capital is reduced to 1 ruble, which is one of the mandatory conditions for the capitalization of the bank at the expense of funds that make up the FCS," Dmitriev said.

Press service of the bank "Trust" among the main reasons for the increase in the negative capital of the credit organization called the costs for the formation of reserves for loans issued prior to the beginning of the procedure for financial recovery of the Trust, revaluation of the securities portfolio and acquisition of shares of financial organizations. "The dynamics of capital does not affect the bank's activity - it continues to work in a regular mode, fulfilling obligations to customers," the bank said.

Forbes analysts commented that the current assessment of the amount of negative capital from FC Opening and Trust Bank is preliminary. The final size of the "hole" in the capital will become known only after the completion of a full analysis of the assets of the banking group conducted by the Central Bank, notes the senior director of the group on analysis of financial organizations Fitch Alexander Danilov. "Typically, this procedure takes 6-8 months," he explains.

According to Anton Tabakh, Managing Director for Macroeconomic Analysis and Forecasting of the Expert RA agency, the accumulated practice of bank rehabilitation in Russia shows that the final assessment of the hole in the capital of a problem organization often exceeds the preliminary figures by several times. "The trend is that the final estimate of the bank's negative capital doubles or even triples compared to the initial one," he comments.

August 29, 2017, the Central Bank announced the rescue of the bank "FC Otkritie", which ranked by assets eighth in the banking system of Russia. The Central Bank announced that after the termination of the temporary administration, the regulator will receive at least 75% of the shares in FC Otkritie. And its owners will be able to own a share that does not exceed 25% of the shares, but only if the interim administration does not reveal negative capital in the bank. "In this case, the current shareholders completely lose their ownership rights to the bank," the Central Bank said in a statement.

The key shareholder of the bank "FC Otkrytie" is the "Opening Holding", which has 66.64% of the voting shares. A package of 28.61% in the "Opening of the holding" owned by Vadim Belyaev. Among the beneficiaries of the "Holding's Opening" are also IFD and IST groups, VTB Bank, Ruben Aganbegyan and billionaire Alexander Mamut.