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Moldova cbank withdraws Investprivatbank licence

Moldova cbank withdraws Investprivatbank licence

Moldova's central bank said on Friday it was withdrawing the licence of Investprivatbank, one of the country's smallest banks, and had named an administrator to wind up the bank.

But central bank officials said they saw no risk of bankruptcy in any of the other banks in the ex-Soviet state.

"On June 19, 2009, Moldova's central bank issued an order withdrawing from Investprivatbank its licence to conduct financial activities. It has appointed an administrator to wind up the bank," the central bank said in a statement.

Investprivatbank was one of the smallest of 16 banks operating in the former Soviet republic wedged between Ukraine and Romania.

A senior central bank official said Investprivatbank's managers had engaged in risky mortgage operations, provided inaccurate information on the size of the bank's capital and proved unable to meet debt obligations.

"Owing to a lack of liquidity, the bank cannot meet its obligations to its customers. The bank fell into a situation of insolvency," Ema Tabirta, the central bank's vice-president told a news conference.

Tabirta said 40 percent of the bank's shares were held offshore, while 60 percent were held by individuals in Moldova, including bank staff.

Investprivatbank's own data showed assets of 1.396 billion lei ($126 million), the volume of its credits 1.89 billion lei and deposits 1.107 billion lei. But central bank monitoring had cast doubt on those figures.

"We cannot at this time establish the value of the bank's debts," said Ion Ropot, the administrator now overseeing the bank's operations. "It will be established after an inventory is conducted."

Tabrita said checks had shown that Investprivatbank had fallen short of the central bank's requirements in terms of liquidity, but the banking sector was in generally good shape.

"The overall situation in the banking sector is stable," she said. "There is no reason for any panic. As of this moment or in the near future I see no reason for any other bank to be declared bankrupt." ($=11.1 Moldovan lei)

Source: Reuters


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