The National Bank of Tajikistan (NBT) has revoked licenses from Tojiksodirotbonk (TSB) and Agroinvestbonk.
The NBT press center says the NBT Board revoked licenses from these two of the country’s largest banks on May 21.
“Despite the constant support of the government, the financial state of these banks has not improved and they have failed to ensure sustainable operation,” Tajik central bank said in its statement.
Numerous complaints and claims against these banks have reportedly led to a drop in public confidence not only in them, but also in the country's banking system.
The statement notes that in accordance with court decisions, special administrators will be appointed to these banks, who will deal with the further management of these two banks, that is, the process of their liquidation.
According to data from the NBT, a total number of Agroinvestbonk depositors is now 27,700. 23,700 deposits, which is 86 percent of the overall number of deposits in the bank, will be will be fully compensated by the Individuals Deposits Insurance Fund, and the remaining 4,000 deposits will be compensated partially.
A total number of TSB depositors is 5,500. Savings of 3,500 depositors (64 percent) will be fully refunded by the Individuals Deposits Insurance Fund, while the remaining 2,000 depositors will receive their money partially.
The Individuals Deposits Insurance Fund reportedly guarantees a return of savings in the amount of up to 30,000 somonis in the national currency and up to 21,000 somonis in the foreign currency which will be returned immediately after the occurrence of the insured event.
The rest of the deposits will be returned through the sale of the assets of these banks by the special administrators, the statement added.
It is to be noted that Tajikistan’s banking system has still not recovered from the 2015 financial crisis.
Recall, TSB and Agroinvestbonk have been experiencing financial problems since the beginning of 2016, and therefore failed to fully meet their obligations to customers.
In 2017, the government provided financial assistance to these banks. Tojiksodirotbonk received a total of 2 billion 250 million somonis, and Agroinvestbonk – 1 billion 70 million somonis.
State support has been granted for a five-year term at 2% per annum. In 2018, the banks had to return 5% of these funds, this year – 20%, and in subsequent years – 25% each.
Banks pledged to simultaneously improve their financial condition, in particular by attracting additional investments.
The government now owns 85.9 percent of the shares in Tojiksodirotbonk. Before that, 58.89 percent of TSB’s shares had been owned by Closed Joint-Stock Company (CJSC) Evraziya (Eurasia), 11.65 percent by Melodiyon LTD, 10.99 percent by Ehson LTD, 7.38 percent by Media Plyus (Plus) LTD and 1.11 percent by Vostok LTD.
TSB was established in December 1990 as the Tajik branch of the Vnesh Econom Bank of the former Soviet Union, and it initially specialized in trade and import-export banking. Later this branch was reorganized into a Joint-Stock Commercial Bank “Tajikvnesheconombank”. In June 1999 the bank was renamed and registered as Tojiksodirotbonk or TSB.
Headquartered in Dushanbe, TSB has 11 branches in the main cities of Tajikistan and covers all regions of the country.
As of May 1, 2018, assets on TSB’s books reportedly include the bank headquarters in Dushanbe, 43 branches across the country, Closed Joint Stock Company (CJSC) Dushanbe Mall (Tajikistan’s largest shopping mall, which is home to the country's first ever hypermarket to be part of the French Auchan chain), Tajikistan Hotel in Dushanbe, eight nine-story apartment buildings in Danghara district (Khatlon province), spinning mills in Danghara and Farkhor districts (Khatlon province), cotton ginneries in Khatlon province, and auto-repair enterprise.
Founded in 1992, Agroinvestbonk, with headquarters in Dushanbe, is now 87.3 percent government-owned as a result of the bailout program. It has main branches in Khorog, Khujand, Kulob and Bokhtar and more than 60 other branches across the republic. In 2012, the government made a decision on recapitalization of Agroinvestbonk and injected 700 million somonis in the bank. 200 million somonis went to replenishing the bank authorized capital stock and 500 million somonis were assigned for the swap.
According to data released by the government, the list of Agroinvestbonk’s assets includes more than 730 objects located in different regions of the country. Among them are the main office of the bank, 60 buildings of its branches, and five service centers. Also, this bank owns recreation areas in the Varzob gorge, various small production facilities, farms, warehouses, gas stations and car services, shopping centers. The list also includes shops, pharmacies, cafes, consumer services centers, numerous apartments and residential buildings.
