Friday, December 26, 2014

Russian Regulators Take Over National Bank Trust as Long Lines Form

National Bank Trust had aggressively wooed depositors 
with high interest rates and advertising featuring 
actor Bruce Willis. Reuters
Russian regulators took over a leading retail bank Monday, as the impact of last week’s currency crisis reverberated through the economy even as the ruble recovered.
Russia’s Deposit Insurance Agency said it had temporarily taken over OAO National Bank Trust and was prepared to provide up to 30 billion rubles ($549 million) in funding as it sought an investor from the ranks of Russia’s other major banks to take over ultimate control. The agency said the takeover would ensure normal operations of the bank, known as Trust, but customers reported huge lines at Moscow branches and trouble withdrawing funds.
Banks across Russia reported a surge in withdrawals last week as the ruble plunged to record lows early in the week and the central bank raised interest rates to steady the currency.
The crisis was a blow to a banking system already weakened by Western sanctions and a souring economic outlook. Authorities scrambled to shore up the banks, with parliament approving laws in a single day to provide one trillion rubles in new capital, while the central bank temporarily eased regulatory requirements.
Underlining the urgency of the situation, Prime Minister Dmitry Medvedev gathered top bankers for a special meeting Monday to “synchronize our watches” on measures to stabilize the markets and the financial system.
Read the rest of the story HERE.

Here is a link to a related story:

China Offers Russia Ruble Help

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