Master Bank in Russia closed as licence is withdrawn

The doors of Russia’s Master Bank are closed, the ATM machines silent and clients and creditors waiting. The mid-size bank reportedly has a hole of around 45 million euros in its capital and has had its licence withdrawn. It was also subject to, “large-scale dubious operations”.

That’s a phrase used by Russia’s central bank which withdrew the licence. It’s understood to refer to money laundering, false accounting and loans to connected parties. It is now a waiting game for those with money in the bank.

“With regard to our commitment to the bank’s clients we have a system of guarantee for deposits limited to 15,800 euros. The clients will be able to begin to withdraw money from their accounts no later than December 4,” Elvira Nabuillina, Central Bank governor told the State Duma.

It’s unclear what action will be taken, if any to protect those with amounts over the guaranteed limit.

An official statement on the bank’s website referred clients to the relevant law on bank bankruptcy.

It’s estimated withdrawing the licence will cost the state’s Deposit Insurance Agency around 675 million euros its largest pay out to date since the agency was created in 2004.