The Bank of Russia on Monday, 23 January, for the first time in the history of decision-making on reorganization or revoke licenses from problem banks re-entered the moratorium on satisfaction of creditors ‘ claims against the Bank “Peresvet” for a period of three months. The previous three-month moratorium, imposed in October, expired last Friday. As yet precedent of extension of the moratorium was not the actions of the Central Bank came as a surprise to the creditors, the waiting or revocation of the license of the Bank or the pronouncement of the decision on its reorganization, as suggested by the law “On bankruptcy”.
The official press release of the Central Bank of the extraordinary clarity of the situation of “Peresvet” is not added. In it the regulator has invoked article 189.38 of the law “On bankruptcy”. But according to this article, the regulator “may impose a moratorium on satisfaction of creditors’ claims for a term not exceeding three months.” The possibility of imposing a new moratorium or renew an existing it does not say.
In addition, the Bank of Russia said that the introduction of a new moratorium, “not being insured, does not negate the obligation of ASV on payment of insurance compensation” within the first moratorium. The Central Bank, responding to a question about the wording, only explained that “the occurrence of two insurance claims in respect of one Bank — participant of Deposit insurance system the legislation does not provide”.
Legal — illegal
Most of the interviewed lawyers was categorical: in this case, the Central Bank broke the law. “The re-introduction of the moratorium provided by the law on bankruptcy, and I with this decision do not agree,” — said the partner of the legal company Westside Advisors Sergei Volodin.
“From a legal point of view, — says partner of lawyer Bureau “Partnership of legal aid” Sergey Romanov — the actions of the Central Bank unlawful, and the legislator, not by the law of an explicit prohibition on the introduction of a new moratorium, proceeded on the basis that it is an exceptional measure to be used in extreme cases and, therefore, the period of three months is preclusive and increased by any means not to be”. In his opinion, the Bank of Russia has applied this rule in their own way and in such a situation, those creditors who do not agree must apply to the court to assess the legality of such law enforcement, eliminating (or, conversely, to make it possible) this practice in the future.”
The legal situation is obvious, agrees partner of the law firm Lidings Stepan guzey. “The wording of this article of the bankruptcy law with reference to the maximum period of the moratorium and without reference to the possibility of extension suggests that the norm is peremptory and a different interpretation is not a subject in this case is a gross violation of the said article of the law on bankruptcy,” he says.
The same position is shared by the partner of the company “Iontsev, Lyakhovsky and partners” Igor Dubov. “In the corresponding article of the law expressly says that the moratorium is imposed for a period up to three months. This period has expired. Thus, in this case, is the place to be violation of the law. Why it went the Central Bank — a question to the Central Bank,” says Oaks. In his opinion, in this situation, lenders are “quite natural” may find their rights violated and to apply to the court to declare unlawful act of the Central Bank on the introduction of a new moratorium, and later a separate lawsuit to try to recover from the Bank of Russia, losses in the difference between moratorium interest and interest accruing to them under contracts with the Bank. “Moreover, theoretically, the creditors can apply to law enforcement with allegations of abuse by the Central Bank of its powers. Those, if it considers such application justified, may require the Bank to eliminate violations and cancellation of the second moratorium,” — said Dubov.
The re-introduction of the moratorium can have consequences not only for creditors, but to resolve the question of his possible rehabilitation will not preclude Oaks. According to him, the risks of re-recognition of the illegal moratorium could generate risks for potential bail-in (the conversion of Bank debt in its capital) — as a prisoner under the influence of fraud. “However, the question is how we can prove it in court. And most importantly, will this the Bank’s creditors, for whom such a principled position would mean the likely loss of most of its assets (the Bank will go into bankruptcy, in which, according to statistics, the third priority creditors get little),” he says. “So in a situation where the money to creditors is more important than justice, the regulator, as practice shows, can much afford. How painless — only time will tell”, — he concluded.
Money is more important
In contrast to independent lawyers, the parties, dependent on the resolution of the situation with the “Peresvet”, was much less categorical. The largest shareholder of “Peresvet” — the financial and economic management of the Russian Orthodox Church (which owns 36.5% of the shares) did not respond to a request.
Another shareholder — “Expocentre”, which owns 24.4% of the shares of the Bank (the company itself by 50.8% belongs to the chamber of Commerce and industry) — also did not answer the questions . The representative of the press service of the CCI said that the house believes a moratorium is “a positive thing, as it is required to ensure the safety of funds (excluding deposits of individuals, which are paid in accordance with the law on Deposit insurance) for the period of the development program of recovery and restore the normal functioning Bank”.
Creditors “Peresvet” — including “inter RAO UES”, “RusHydro”, the Bank, Sovcombank, “Otkrytie”, Bank “Zenit”, Tatfondbank, Svyaz-Bank and Russian agricultural Bank — chose to abstain from commenting on the merits. In the RRDB, which is considered the main contender for the improvement of the “Peresvet”, did not respond to a request . In such a situation it is not excluded that those wishing to expose the claims of the Central Bank and did not find, do not exclude market participants.
A political issue
In this case, the actual extension of the moratorium against the rule and spirit of the law (a period of three months the law was established as more than sufficient to assess the situation in the Bank on the possibility of reorganization and the carrying out of all necessary corporate procedures) rather forced and may have a political background: among the Bank creditors of large state-owned companies, in particular Rosneft.
Last week, in the composition of the interim administration of the Bank was comprised of affiliated with Rosneft, RRDB Bank. It happened after the end of 2016, the head of “Rosneft” Igor Sechin, is included in the composition of boards of Directors “RusGidro” and “inter RAO”, and the President of the chamber of Commerce and industry Sergei Katyrin and the head of “RusGidro” Nikolay Shulginov appealed to Prime Minister Dmitry Medvedev with the request to support the reorganization of “overexposure” with the use of the mechanism of bail-in. As reported, Medvedev’s appeal was supported.
Many lenders “Peresvet” then regarded this step as the appearance of certainty for the main group of investors “Peresvet”. “Do not forget about the political component of the situation with the Bank, and under the pressure of this factor in the actions of the Central Bank, which obviously over the last three months of the first moratorium found acceptable to all recipe rescue of the Bank, surprise that just don’t call”, — says Stepan guzey.
The Central Bank on this occasion said that “the moratorium is not extended, but imposed a new moratorium for another three months with the objective to allow creditors to continue work on a possible agreement on the future prospects of the Bank “Peresvet”. Usually, the Bank of Russia does not comment on operating banks.