Bank Sputnik

2022: US sanctions for ties with DPRK

In May 2022, the United States imposed sanctions against two Russian banks for ties with the DPRK: Far Eastern Bank and Sputnik Bank.

2021: Introduction of provisional administration and revocation of license

In September 2021, it became known about the introduction of a temporary administration at Sputnik Bank and a moratorium on settlements with creditors. This was done due to violations identified in the credit institution, including an overstatement of the value of assets in the reporting, as well as dubious currency and exchange transactions.

The Deposit Insurance Agency (DIA) will serve as interim administration for six months. The introduction of a moratorium on satisfying the claims of bank creditors is an insurance case. DIA promised to begin payments no later than September 24, 2021.

The Central Bank said that Sputnik Bank violated federal laws governing banking, as well as Bank of Russia regulations, and therefore the regulator has repeatedly applied measures to it over the past 12 months, including restrictions on certain types of transactions.

The Bank of Russia changed its management at Sputnik Bank, which worked with the DPRK

A proper assessment revealed a decrease in the capital of a credit institution to below the size provided for banks with a basic license, which indicates signs of an unstable financial situation, the Central Bank said.

It is noted that Sputnik is the only Russian bank with which the DPRK Foreign Trade Bank has correspondent relations.

According to Yuri Belikov, Managing Director for Validation of the Expert RA Rating Agency, following the completion of the work of the DIA interim administration, two options are equally probable in Sputnik Bank: either reorganization or revocation of the license. This decision was postponed to study the property of the bank, the condition and quality of its assets. Assessing the significance in the case of small banks is rather an expert judgment on the local significance of a credit institution in certain market segments or regions, as, for example, was the case with the SMB, Belikov explained in a conversation with Kommersant^[1]

November 1, 2021 it became known that the Central Bank revoked the license from Sputnik Bank. The bank has completely lost capital. This was the only Russian bank that served the operations of UN agencies for the DPRK.

2015

In accordance with the licenses, the bank was granted the right to carry out the following banking operations:

• Attraction of funds of legal entities and individuals in deposits (on demand and for a certain period);
  
• Placement of funds of legal entities and individuals attracted to deposits (on demand and for a certain period) on their own behalf and at their own expense;
  
• Opening and maintaining bank accounts of legal entities and individuals;
  
• Making money transfers on behalf of legal entities and individuals, including correspondent banks, to their bank accounts;
  
• Collection of funds, bills of exchange, payment and settlement documents and cash service of individuals and legal entities;
  
• Purchase and sale of foreign currency in cash and non-cash forms;
  
• Issuance of bank guarantees;
  
• Carry out money transfers on behalf of individuals without opening bank accounts, including electronic funds (with the exception of postal transfers).

Notes