Azerbaijan, Baku, July 17/ Trend, A.Akhundov /
One or several banks will pay compensation to the depositors of Azerbaijani JSC 'RoyalBank', whose banking licence was terminated by the Central Bank of Azerbaijan (CBA) last week, executive director of the Azerbaijan Deposit Insurance Fund (ADIF) Azad Javadov told Trend.
Based on the CBA's letter, on July 14 the Council of Trustees of ADIF has decided to start preparatory work for the payment of compensation and selection of an agent bank.
"Selection of an agent bank will be based on the following criteria: the level of compliance with prudential norms of the CBA in recent years, availability of an expanded branch network and its coincidence with the geography of placing branches of the bankrupt bank, ability to work online, experience in working with physical entities, number of employees, serving clients in each branch and so on," Javadov said.
He said at present, a preliminary list of eight banks from which agent banks will be selected, is already ready.
"We will select one or more banks from them. It is possible that compensation will be paid by several banks as RoyalBank has a large network of 32 branches," Javadov said.
The CBA board of directors made a decision on the revocation of RoyalBank's licence on July 12. According to the decision, a temporary administrator has been appointed in RoyalBank since July 13.
"The licence was liquidated because the bank did not comply with the minimum level of requirements and the adequacy of the total capital," the central bank said earlier. "It did not fulfil its obligations to creditors and the written instructions of the Central Bank. It did not operate properly."
The Central Bank will appeal to the judicial bodies to launch Royalbank's bankruptcy proceedings.
According to the law on 'Banks', immediately after the Central Bank makes a statement about the beginning of bankruptcy proceedings, a moratorium on the bank will take effect.
RoyalBank is a commercial bank operating in Azerbaijan. It has 32 branches in Baku and regions of the country. The bank has a Royal Card processing centre.
Royal Bank was established on August 2, 1993 as the joint commercial bank 'OZ Bank'.