Scandals with large banks in recent times is not uncommon. Time has shown that even those who seemed stable and even entered the top ten suddenly collapse. However, there are financial institutions that skilfully avoid scandals. And with the help of skilfully posted articles about their allegedly stable situation and financial tricks still keep afloat. One of these can be the "Orient Express" bank. This was reported by the correspondent of Morning News.
The problems of banks sometimes resemble a snowball. He rolls quietly himself, rolls on until he becomes huge and rushes forward, sweeping away everything in his path. And then you can not always have time to react. Just stay with a broken trough.
As early as 2015, rumors about the presence of problems with the bank "Orient Express". Financial portal FINHOW.RU reported that the bank was in a difficult situation. Investments in the amount of 3-5 billion rubles were required to make up for the loss of capital.
It was mainly due to a reduction in the loan portfolio and a sharp deterioration in the performance by some borrowers of their credit obligations. The bank was preparing to issue an additional issue, the purpose of which was to takeover or merge.
However, at that time, those who wished to help the bank, apparently were not found. And this is not accidental. The hard position of the bank was, most likely, due to his specialization in working with unsecured loans to natural persons. Such loans are at risk of non-return. That's why it's no wonder that nobody pozaris on the "Orient Express".
As a result, according to FINHOW.RU, 25% of the personnel was reduced and almost half of the offices were closed across the country. The losses of the bank were estimated at 6.5 billion rubles.
It would seem that everything is going to collapse, but somehow the bank then stood on its feet. And financial analysts suggested that the bank could still find a financial partner. So it happened afterwards.
Merger with Uniastrum Bank
The main shareholder of Vostochny Express Bank is the funds managed by Baring Vostok. Throughout 2016, there was a search for a new investor for the bank. And in the end, they agreed to merge with the bank "Uniastrum", which looked, at least strangely, considering the reputation of "Uniastrum". The association was held in January 2017.
Back in 2008. The Bank of Cyprus acquired 80% of the Russian bank Uniastrum for $ 576 million. Twice as much as its value! This led to the fact that the Cyprus bank in 2011. was forced to apply for support in the Central Bank of Cyprus with a request to allocate 0.5 billion euros to close the financial hole.
Analysts suggest that the overpaid $ 288 million could be "sawn between the managers of the two banks." It was not possible to prove this, but the reputation of Uniastrum was seriously spoiled.
It is possible that Artem Avetisyan, the main owner of Uniastrum, tempted Baring Vostok with the idea of uniting four financial institutions, as a result of which the merged bank could enter the top-20 Russian banks.
The cunning idea of Avetisyan?
Artem Avetisyan initially, in 2016, pierced the creation of a basic bank for lending to small and medium-sized businesses. It was planned to unite the banks "Uniastrum", "Orient Express", "Credit Europe Bank" and "MSP-Bank".
Probably, Artem Avetisyan wanted to sit down on state money and become a kind of intermediary between the Central Bank and entrepreneurs. However, this number did not pass. Apparently, the Central Bank has spotted Avetisyan's plans.
SME Bank was part of the SME Development Corporation and did not want to unite with Uniastrum Bank, because it already participated in the SME lending program. Why did he need Avetisyan?
The owners of "Credit Europe Bank" also said that the bank will continue to work independently. And there can be no talk of any radiance or absorption. As a result, the Central Bank approved only the deal to merge Uniastrum and Orient Express.
Bank "Uniastrum" formally belongs to the Cyprus company "BOK Rasha Holdings Limited", and through it through a complex scheme Artem Avetisyan. Not surprisingly, no one was going to trust the banker with considerable budgetary funds for his mega-project. They could easily leak into offshore. What, perhaps, was planned?
Artem Avetisyan had only to use for his purposes the bank "Oriental Express." And, probably, it was necessary to think, how now after refusal of the Central Bank to solve problems of both banks. And they did not keep themselves waiting.
New problems of the "Orient Express"?
After merging with the bank "Uniastrum", the bank "Orient Express" for some reason did not cease to need capital. That is, the goal of the unification was not achieved. Or, perhaps, the bank immediately began to perform the "tasks" of Artyom Avetisyan?
To resolve its problems, the bank in April offered holders of subordinated bonds to convert the securities into indefinite. If the bank did not increase capital, this could raise doubts about the ability to continuously continue operations.
It is interesting that the capital of the merged bank was needed in connection with the creation of reserves for non-core assets of Uniastrum Bank. In the event that they are discounted. It turns out that Artem Avetisyan solves the problems of "Uniastrum" at the expense of the bank "Orient Express"? So, at the expense of its investors?
Analysts note that some borrowers of Uniastrum may have had signs of a lack of real activity. However, the management of the bank took advantage of its right to consider their activities as real. Only here figures you will not deceive!
In April, the capital adequacy of the first level of the bank was 7% at a comfortable level, according to analysts, at least 7.5%. They noted that the bank this year will need 6 billion rubles. Neither Baring Vostok nor Avetisyan responded to the journalists' requests. That in itself is amazing for a clean and transparent bank.
In May, it became known that the holders of the Eurobond issue of Vostochny Express Bank agreed to change the terms of the subordinated loan with maturity in 2019. It would seem that the problem was solved.
However, at the end of July the next bell rang. On July 27 Eurobonds of the "Orient Express" offered to buy at a price of 59% of the face value, which corresponded to a yield of 17% per annum. And such a high yield usually indicates that the market began to expect the issuer's difficulties.
Naturally, the chairman of the board of the bank "Orient Express" Alexei Kordichev immediately stated that "stock prices do not reflect the real picture, as there is practically no bidding on securities." And what else did the chairman of the bank say, who may have had problems?
Will the bank survive until New Year's loans?
Analysts immediately noted that the second-series bonds of the bank are yielding about 75% per annum. And such an excessively high yield of bonds often indicates the approach of the problems of the bank.
As an example - the bank "Peresvet". October 5 - a sharp increase in yield bonds, and already on October 21 - the introduction of the interim administration. Is it really waiting for the bank and the "Orient Express"?
The collapse of each bank occurs in different ways. One can "burst" in two weeks, another stretch another month or two. Snowball is formed in different ways. However, for investors this difference is insignificant. Anyway, as a result, you can stay with nothing.
The history of the bank "Orient Express" after falling into the hands of Artem Avetisyan can end suddenly. Who knows, maybe the depositors' money is already flowing into Cyprus offshore? And soon thunder can burst! The main thing is that he does not take unawares.