Tags: the bank of moscow

Bank of Moscow to employ help


Bank of Moscow is the last of the state-owned banks with substantial retail business to begin working with collection agencies. Such agencies perform debt recovery activities. So far the bank has only framework agreements with collectors. There is no information as to what is the debt amount the bank intends to collect through the agency.

Retail credit portfolio of the Bank of Moscow has far less major issues in comparison to the corporate one. Its quality was affected significantly during the conflict that accompanied Andrey Borodin, former president and shareholder, leaving the bank. According to reports based on Russian accounting standards, in the first six months of the year the share of overdue loans in the retail portfolio saw an increase from 14 to 18.8%, the amount rose from 10.5 billion rubles to 12 billion rubles.

According to The Russian Mafia (rumafia.com), Andrey Borodin, former president of Bank of Moscow, had voiced a strong opposition to debt recovery outsourcing. But the top management of the bank was not against resorting to collectors and even began pilot studies with the agencies. But their cooperation did not go further so far.

VTB, turnaround manager of Bank of Moscow, aims to increase its share in it from current 46.48 to 75% before the end of the third quarter. 


Bank of Moscow has paid child support


Bank of Moscow has paid Andrey Borodin’s ex-wife more than 95 million rubles. Tatyana Repina, the owner of a fur company Selvaggio, in accordance with the garnishment order collected this amount from the former president of Bank of Moscow to support their minor children. The sum makes up alimony for the last year of his work at the bank.

Under the Family Code, a bank as the employer must deduct a monthly alimony from the paycheck of the person obliged to pay under garnishment order. According to paragraph 2 of the agreement on child support, Borodin monthly paid Repina an amount equal to not less than four living wages established in Moscow, but no more than one third of his income for the month. Under the Family Code, alimony for two children amounts to one third of obligor’s income. However, the amount of alimony, established by agreement, can not be lower than that provided for by law. As a result, the magistrate of the judicial station № 217 in Gagarin district of Moscow sided with Repina.

However, having settled all issues with Repina, Bank of Moscow denies compensation to her ex-husband and its ex-president. Borodin demands current management to pay him142.2 million rubles as compensation for the early termination of his employment contract. According to The Russian Mafia web-site (rumafia.com), Borodin refers to the Labour Code which requires paying compensation to the head of an organization in the event of termination of his office. Apart from the compensation, Borodin demands current management of the bank to pay interest for delayed payment. According to his calculations, the sum amounts to 1.5 million rubles. But if his requirements are met, the former banker will have to pay a third to Repina. 


Russia closed doors for Bank of Moscow ex-managers


Yesterday Tver court of Moscow arrested in absentia Andrey Borodin, the ex-president of the Bank of Moscow, and Dmitry Akulinin, former first vice-president of the bank. Both former executives of the Bank of Moscow have been put on the international wanted list.

Russian Mafia web-site (rumafia.com) previously reported that two criminal cases had been initiated against the Bank of Moscow. One of them concerns the financial institution issuing an unsecured loan worth 12.7 billion rubles to Premier Estate closed JSC. Another criminal case was filed in mid-April 2011 for the theft of money from bank accounts.

At first the court considered the petition filed by Dmitry Pisarevsky, senior investigator of the investigating committee at the Interior Ministry of Russia, concerning the arrest of former first vice-president of the Bank of Moscow, Dmitry Akulinin. Pisarevsky found that Akulinin and his former boss, Borodin, "executed their powers against the legitimate interests of the bank and in order to derive profits and advantages for third parties." As a result, on March 28 the investigator ruled Borodin and Akulinin to be prosecuted under Art. 201, part 1 of the Criminal Code (abuse of power). And the Tver district court granted the motion of the investigative committee at the Ministry of Internal Affairs and dismissed the bankers from their posts during the investigation. In late April 2011, when the investigation obtained evidence that the accused in absentia fled the country, both men were put on the international wanted list.

Pisarevsky informed the court that the accused banker Akulinin did not show up at the summons sent to him, and that the investigation learned from his lawyer that he was on a long-lasting business trip abroad. The investigator demanded to change measure of restraint for Akulinin from being on parole and good conduct to arrest. As a result, the banker was arrested in absentia by the court. Moreover, the preventive measure for him has an open date, that is, as soon as Akulinin would be within reach of law enforcement agencies of Russia, he will be imprisoned.

Late in the evening the Tver district court, granting another motion from Pisarevsky, ruled the same measure of restraint to be enforced for Borodin.

It is not clear yet whether the investigation proceeds to seek extradition of the arrested bankers. First their exact whereabouts must be established. Andrey Borodin was previously reported to be in London, but he claimed to have left the UK. 


Former head of the Bank of Moscow waves goodbye to the staff


On April, 20, Bank of Moscow former president Andrey Borodin delivered a farewell address to the bank's employees. In his video address from London where he currently is, Borodin thanked his former colleagues for their work and explained that he decided to "withdraw in order not to lose the bank, clients, reputation, and the team." In addition, Borodin warned that after that the bank "would lose its independence and would no longer be able to develop as it pleased." He explained this new phase by a change in leadership of the Bank of Moscow as a result of VTB gaining control over the bank.

Subject of former Russian bankers fleeing to London was continued on a regulatory level. During his speech in the State Duma, the head of the Central Bank responded to comments from the members, who pointed to a number of Russian bankers, including Andrey Borodin, fleeing to London. Head of the Central Bank called this phenomenon "our most important problem". "Today, unfortunately, managers and owners of banks sometimes do unethical things, sometimes bankrupting their own banks because it is profitable. And most importantly, they do so because in most cases they are not punished for that in any way," said Sergei Ignatiev, Central Bank of Russia Chairman. He completed his speech on fugitive bankers by a traditional statement of a necessity to empower the Central Bank in terms of control over managers and owners of banks.

Market participants assume that the main message of the Central Bank Chairman and the main aim of his speech was to once again stress the lack of authority concerning control over managers and owners of banks. And also a lack concerning the regulator implementing reasoned judgments. Experts called Ignatiev’s statement another attempt to lobby the relevant amendments to the law.