Just a year ago, there were 24 banks in the Belarusian bank system, while today there are only 21. After coming under sanctions, Absolutbank was reorganized into non-banking credit and financial organization OptiKurs – now it is not considered a bank. Accordingly, it can’t provide many financial services, such as attracting deposits, opening and maintaining accounts of individuals, issuing payment cards, etc.
Other recent losses are Idea Bank, which was acquired by MTBank and became part of it, and Fransabank, which ceased its operations and joined Alfa-Bank.
However, the collapse of the Belarusian banking sector may not end there. According to the publication Belarusians and Market, the reason for the liquidation or reorganization of other Belarusian banks may be the non-compliance with the minimum prescribed amount of regulatory capital (the sum of the authorized capital, other funds, share premiums and retained earnings of the bank (do not mistake with the authorized capital).
This norm has been set by the National Bank of Belarus in Belarusian rubles since 2016, and today it is set at 66,66 million rubles. Moreover, according to the archival data, this norm has never been reduced, but only increased by the inflation rate.
Has there already been a practice of liquidation of banks for non-compliance with the minimum capital requirement?
Of course. In 2012, the National Bank said that it increases the minimum regulatory capital of banks to 25 million euros and gives three years to increase the capital to this value.
Before this decision came into force, there were 31 banks in Belarus. But in early 2015, four banks failed to meet the minimum capital requirement and had their banking licenses revoked, which eventually led to their closure.
In 2015-2016, the following closed due to the lack of capital:
❌ InterPayBank (a Belarusian-Swiss bank that existed until mid-2016);
❌ BIT-Bank (Bank of Investment Technologies – a Belarusian-Cypriot bank that existed until 2015);
❌ N.E.B. Bank (Nord European Bank existed until mid-2016);
❌ Eurobank (a Belarusian-Swiss bank that existed until mid-2015).
What Belarusian banks are at risk of losing their licenses now?
As it was already said above, the minimum value of the regulatory capital of the bank until the end of 2022 is set at 66,66 million rubles, and the increase is at the level of inflation.
So according to the Eurasian Development Bank (EDB), annual inflation has already reached 17,6% in June. That is, if annual inflation remains at the current level, the value of regulatory capital for Belarusian banks will amount to 66,66 million + 17,6% = 78,39 million Belarusian rubles in January 2023.
The most vulnerable at the moment is Cepter Bank, which regulatory capital is already less than the minimum value – on June 1, 2022, its capital was 62,21 million.
A number of other banks are also at risk:
⚠️ Bank Reshenie – 69,21 million (as of July 1, 2022)
⚠️ RRB-Bank – 69,23 million (as of July 1, 2022)
⚠️ BTA Bank – 69,32 million (as of July 1, 2022)
⚠️ Statusbank – 71,33 million (as of July 1, 2022)
By the way, according to our information, Statusbank was sold to the structures of Nikolai Vorobei back in April 2022. You can read it here.
It turns out that if the listed banks will not be able to increase their capital to the minimum values, in the worst case they will lose their licenses for banking activity and will be converted into non-banking credit and financial organizations or liquidated, or they will be given time to build up capital, like it already happened in 2012.
На русском языке:
5 беларусских банков рискуют лишиться лицензии уже в следующем году: как массовая ликвидация банков в 10-х может повториться вновь