Property of shareholders, management of bankrupt banks to be confiscated
By Amina Nazarli
Chairman of Azerbaijan’s Financial Market Supervisory Body Rufat Aslanli has informed about the process of liquidation of local banks at a meeting at the parliamentary committee.
“To date, 11 banks are in process of liquidation. We are asked why this process is delayed?” APA quoted Aslanli as saying.
Preparation of a plan to eliminate only Bank Standard requires a
lot of legal work, he said. “The bank had accounts of 262,000
physical and more than 47,000 legal entities. It is necessary to
determine the list of all their requirements. There are
controversial issues. For example, someone wants to get not 5
manat, but 5 manat 15 qepiks. All these issues must be resolved.
Then it is necessary to draw up a register of bank assets. Both
property and legal requirements, as well as the register of
expected rights must be prepared, evaluated and approved in court,”
he said.
Aslanli further added that under the changes proposed to the
legislation, if the management and shareholders of the bank are
responsible for the problems in this bank, they will have to pay
for the damages.
“We for the first time offer such a practice in Azerbaijan. This
practice is widely used in the world. Often as a result of
irresponsible management actions, the bank becomes bankrupt, and
loses funds attracted from the population. In some cases, fraud is
committed intentionally. Now the state through the Azerbaijan
Deposit Insurance Fund returns the deposits of the population, but
neither the shareholders nor the management of the bank are
responsible. It is not right. The legislation for the first time
introduces this practice. To ensure this, we have added the
necessary articles to the civil and procedural legislation,” the
FMSB chairman explained.
The FMSB has already submitted a package of proposals to the government to change the legislation, where one of the most important items is the application of the process of voluntary restructuring of banking obligations.
“This procedure is widely used throughout the world. This is one of the possible solutions for banks that have lost solvency and are facing problems. Banks will be able to apply for a restructuring of their obligations in court. The application will be considered within 10 days, after which they will receive the answer,” he said.
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Amina Nazarli is AzerNews’ staff journalist, follow her on
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