Often in modern literature one can come across various concepts whose essence we do not fully know. This is exactly the phrase “bank reorganization”. Let's try to understand everything in more detail in this article.
So, what is reorganization, what impact can it have on the activities of financial institutions?
The essence of the term
Remediation is a procedure of a kind of rehabilitation of banking institutions in financial terms. This procedure can be carried out in credit organizations, but only when it becomes possible to avoid bankruptcy, and also with the aim of preserving the largest and most important banks for the economy of the state or a particular region. The answer to the question of what is rehabilitation is the following: it is the search for a suitable investor or general financial recovery at the expense of our own resources.
Who benefits from this?
For investors, reorganization is beneficial. With its help, you can save money in full, and not get only insurance compensation provided for by applicable law and amounting to 700 thousand rubles. At the same time, legal entities understand well what sanitation is if there is one investor-buyer for such a problematic bank. Thanks to these measures, business entities continue to be fully serviced in the same banking institution.
However, the meaning of the word “reorganization” loses its meaning if the “hole” in the bank balance is equal to its balance. Such a financial institution is not subject to recovery. The relevant law provides the right to refuse
financial rehabilitation of banks. Today, reorganization takes place in fifteen banks of the Russian Federation.
Thus, we can formulate what the word "sanation" means. This is the implementation of measures involving not only the restoration of bank liquidity, but also the transformation of the client base with a restart of lending, a review of external and internal processes, and optimization of personnel and the network of branches.
Ways of healing
So, it is necessary to clearly know the features of the situation, since bank reorganization can be carried out in several ways.
Firstly, the sale of such a “bad” bank to another banking institution for a nominal price.
Secondly, reorganization by the joint efforts of the Deposit Insurance Agency (hereinafter - the DIA) and commercial organizations.
Thirdly, a certain part of the assets with the obligations of the rehabilitated bank is transferred to another business entity with the status of a legal entity.
Fourth, the rehabilitation only by the DIA.
So what is sanitation? These are measures to prevent massive bankruptcies of banking institutions. It is safe to say that if the above actions are implemented, then closing the bank can be avoided.
Key Issues
If you go along the third path of rehabilitation, i.e. transfer assets and liabilities to a legal entity with personnel optimization, such a procedure by bank staff may not be adequately perceived. In addition, it is quite successfully disputed by the bank's customers in the courts.
The fourth option of rehabilitation - carrying it out only by the DIA forces - is a very rare case. The procedure can only take place in the absence of another investor.
Ways to solve problems
So, in order to solve problematic issues arising with the staff of a banking institution, the administration carries out explanatory work. In other words, the employees of such a banking institution should clearly understand the reason for the reorganization, and what measures are taken to eliminate it. Also, employees should be able to reassure and provide all the necessary information to the bank's customers.
The next step in solving problems arising in the course of bank reorganization is the organization and strengthening of the call center with an increase in the number of lines and competent operators whose main task is to prevent the outflow of depositors and the extraction of their assets by the bank's customers.
The third step should be to continuously monitor all kinds of media on various publications about the banking institution. We are talking about sharply negative and hostile messages from clients and outside observers.
And the last step is to establish a fixed period of time for meetings with representatives of economic publications. Bank employees must provide reporters with reliable information about the financial condition of the institution. In addition, a schedule of remediation activities may be provided to economic publications to achieve specific results. However, they should be applied in nature. It is required to attach documents directly confirming their reality.