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August 31, 2017

Russia to rescue Bank Otkritie

The Bank of Russia has decided to bail-out Bank Otkritie Financial (Otkritie) that has been suffering a deposit run.

The central bank in a statement said it will take measures to boost the bank’s financial stability and will become the bank’s key investor using the Banking Sector Consolidation Fund.

The central bank did not disclose the investment amount, but said it intends to acquire at least 75% stake in the bank, which has 22 branches and over 400 structural divisions.

The central also said that it will not place a moratorium on creditors’ demands or impose a bail-in option.

“The Bank continues to operate in a normal mode, meets its obligations and conducts new transactions. The Bank of Russia will provide financial support to the Bank and guarantee the continuity of its operations,” the statement added.

The rescue is deemed to be the first of a systemically important bank in Russia.

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