June 25, 2022

Market and Financial News

Market and Financial News Aggregator

VTB Capital seeks to enter administration after ‘paralysing’ sanctions

2 min read

The UK arm of Russia’s second-biggest lender has applied to go into administration, citing the impact of “paralysing” sanctions imposed since Russia’s invasion of Ukraine.

VTB Capital says it has been unable to find a bank that would allow it to open or operate an account and so cannot pay its debts as they fall due.

A majority of its directors applied to London’s High Court on Wednesday for an order to appoint administrators.

Daniel Bayfield QC, representing the directors, told a court hearing that the move would allow an orderly wind-down of the company, which is balance-sheet solvent with net assets of $338mn. 

Bayfield told the court that the lack of banking facilities meant company operations “have been paralysed even beyond the paralysis caused by sanctions. The company can’t make any payments.”

Mr Justice Timothy Fancourt said he was willing in principle to make the order appointing administrators — but he said a formal order would not be made by the court until a licence had been obtained from the US Office of Foreign Assets Control (Ofac), which administers the US sanctions regime.

The High Court heard VTB Capital had discussed its application with financial regulators including the Prudential Regulation Authority, the Financial Conduct Authority and the Bank of England, which had not opposed its plans.

It has also received an adjustment from the UK Office of Financial Sanctions Implementation that permits payments relating to insolvency proceedings — although Ofac is yet to grant a similar licence. Teneo is the proposed administrator, the court heard.

VTB was added to the EU sanctions list on Tuesday, with Ursula von der Leyen, European Commission president, saying the bank would be subject to a “full transaction ban” and would now be “totally cut off from the markets”.

But the move was largely symbolic as VTB had been in the process of winding up its European operations since early March. It had already been hit by US…



2022-04-06 12:24:58

All news and articles are copyrighted to the respective authors and/or News Broadcasters. VIXC.Com is an independent Online News Aggregator


Read more from original source here…

Leave a Reply

Copyright © All rights reserved. | Newsphere by AF themes.