Bank Standard depositors receive compensations

By Azernews

By Nigar Abbasova

Azerbaijan Deposit Insurance Fund (ADIF), which performs a role of a liquidator in the closed banks, launched payment of compensations to the depositors of the bankrupt Bank Standard on October 11. 

ADIF will pay compensations worth up to 20,000 manats ($12,495) for insured deposits at the initial stage. 

National currency-denominated deposits will be repaid in the national currency, while foreign exchange-denominated deposits in the deposit currency. 

If a deposit contains multiple currencies, the compensation is paid in manats at the exchange rate of the day when the insurance event was declared in the financial institute [October 4, 2016].

Compensation payment will be made in the head office and branches of Bank Standard in Baku and regions of the country within a year.

Bank Standard’s license was revoked on October 1, following an insurance event, which became the biggest ever occurred in the banking system of Azerbaijan.

The decision on the revocation of the Bank’s license was taken by the Financial Market Supervisory Body (FMSB), on the basis of an appeal made by Bank Standard and Azer Turk Bank, which had been performing a role of a special administrator over the bank since July 4. The bank declared its bankruptcy on October 4.

ADIF has recently appealed to the Central Bank of Azerbaijan (CBA) to get a credit worth 460 million manats ($282 million), while the insurance event that occurred in Bank Standard became the reason of the appeal.  

The Azerbaijani Finance Ministry then approved a state guarantee for Central Bank’s loan meant for returning deposits in Bank Standard.

The volume of deposits in the Bank totaled 603 million manats ($ 376 million), including 568 million manats ($354 million) of insured deposits.

Bank Standard’s mortgage portfolio was transferred to Muganbank and NBCBank.

Bank Standard was established in 1995. It was one of the largest private commercial banks in Azerbaijan and one of the market leaders in terms of deposit amount.