A credit institution is legalized economical society, which is authorized to carry out Bank operations.
Definition of a concept
A credit institution is a legal entity that, on the basis of a permission and a license, is engaged in the provision of banking services. The purpose of the functioning of such institutions is to make a profit. Such organizations can be created in the form of a joint stock company, as well as with additional or limited liability.
Credit organizations of the Russian Federation undertake to have several attributes:
- name in the state language and, if necessary, abbreviation;
- translation of the name into foreign languages;
- unique logo;
- company print.
It is worth noting that institutions do not have the right to use words such as “bank” or “credit institution” in their name. This is considered a serious violation. it is also worth refraining from using the full or abbreviated name of the country and the analogy with the names government agencies. It is also worth noting that managers, as well as the chief accountant of a credit organization, do not have the right to occupy any positions in similar organizations.
Types of Credit Organizations
Quite a common phenomenon are companies engaged in the provision of banking services. Types of credit organizations are as follows:
- a bank is an organization that has the right to provide the most comprehensive range of services, which includes not only raising and placing funds, but also maintaining accounts of individuals and legal entities;
- foreign bank - similar to the previous one, but the holder of capital is not a resident of the state in which he is registered;
- A non-bank credit institution is an institution that has limited authority in the provision of banking services and operations.
Association of credit organizations
Credit organizations can be united in certain groups for the purpose of cooperation, which can be represented in the following forms:
- unions and associations are created to protect interests, as well as to work together to improve the organization of activities (services are not allowed for profit);
- groups of credit organizations carry out joint activities to provide banking services, which is carried out on the basis of a signed agreement;
- A bank holding company is an association whose management can directly or indirectly influence the policies and activities of members of this community.
Principles of activity of credit organizations
Credit organizations carry out their activities on the basis of the following principles:
- economic freedom - unlimited use of own funds for any activity that does not contradict the norms of the law;
- the same degree of state protection for any form of ownership;
- the common economic space implies that in the state in which the credit institution is registered, all financial flows are carried out without hindrance;
- unfair competition or collusion between credit organizations is not allowed;
- maintaining a balance between the economic interests of the state, business companies and the population;
- strict observance of all legislative norms;
- employees of credit organizations must carry out their work in good faith, and also take the initiative in, if necessary, improve the mechanism of functioning of the institution;
- freedom of contract states that all entities can freely and without coercion determine partners for the agreement, as well as the time and place of its signing;
- information security implies the creation of a system for protecting confidential data;
- protection of the interests and rights of the entrepreneur in judicial and other instances.
Bankruptcy
The banking sector is quite vulnerable to crisis phenomena in the economy, which, at times, leads to quite serious problems. One of such unpleasant consequences may be considered bankruptcy of credit organizations, which is regulated by the relevant federal law.
Bankruptcy occurs when the arbitral tribunal has recognized a credit institution as its inability to meet debt obligations, as well as mandatory payments (taxes, fees, etc.). Insolvency can also be declared directly by the institution. The following points can be considered as features of bankruptcy of a credit organization:
- inability to satisfy the claims of creditors regarding the repayment of debts for which payment has occurred in the reporting period;
- lack of ability to pay taxes and other fees;
- recognition of these facts by the arbitral tribunal following a preliminary investigation.
It is worth noting that the bankruptcy of credit organizations is almost impossible without submitting an application to the arbitration court. If other institutions have the right to declare their insolvency, having independently settled with creditors against existing funds, such organizations do not have this right. If, however, an independent statement of insolvency has not been submitted to arbitration, then the creditors have the right to independently make such a claim at the appropriate instances.
The main signs that indicate the onset of bankruptcy can be considered the following:
- failure to fulfill obligations to repay loans granted, as well as tax fees;
- from the date of the expected date of fulfillment of obligations must be at least one month;
- a license was revoked from a credit institution for the provision of services and a number of operations;
- outstanding debt should collectively be an amount that would not be less than a thousand times the minimum wage;
- the value of the property owned by the credit institution does not cover the obligations imposed on it.
A sufficiently important point can be considered the prevention of bankruptcy, which includes a number of preventive measures:
- continuous monitoring of the economic situation, as a result of which financial recovery procedures are being introduced;
- involvement in the management of the organization of crisis management;
- reorganization of the institution.
Organization of credit organizations
The functioning of institutions providing banking services has some features. So, the organization of credit organizations begins with registration. To do this, you need a certain list of documents, namely:
- application and business plan submitted to the Central Bank;
- the charter of the organization certified by the head;
- payment document on making the corresponding amount of state duty;
- tax returns on income for the last year of individuals who act as founders of a credit organization;
- information about the persons whom it is planned to appoint to the post of executive director, as well as chief accountant.
Also, to start their activities, credit organizations of the Russian Federation must obtain an appropriate license.To do this, you must fully pay the registered capital. This must be done no later than within a month after the approval message from the Central Bank.
Russian credit organizations operate on the basis of the federal law "On Banks and Banking". It also regulates the form of the charter of such institutions. It should contain the following items:
- unique brand name;
- an indication of the legal form in which the organization is created;
- contacts and coordinates (not only of the institution itself, but also of its units);
- a list of operations that are planned to be carried out in the course of activities;
- amount of authorized capital;
- information about the shares (their number and par value);
- information about the management system.
Grounds for refusal to register a credit institution
Not always applying for a license and permission to carry out activities brings positive results. A credit institution may be denied registration for the following significant reasons:
- inconsistency of candidates for the position of head and chief accountant with educational and qualification requirements;
- the existence of convictions for economic crimes by the leaders or founders of the organization;
- the dishonesty of the founders in terms of repayment of mandatory payments or their unsatisfactory financial condition;
- inconsistency in the design of the submitted documents with the standards established by law or the content of false information in them.
In the event that the founders disagree with the refusal to register or issue a license for the activities of a credit organization, they have the right to appeal to the arbitration court.
Rights of organizations
The rights of credit organizations are that they have the ability to carry out banking operations as provided by law, as well as a license (this refers to special legal capacity). Also, such institutions can seek to fulfill debt obligations by all legal means. Another important aspect of the activities of credit organizations is their right to issue and place securities to replenish their capital. It also provides the opportunity to form reserve funds from the funds that make up the profit.
In the event that a credit institution commits a violation of the law, the Central Bank reserves the right to revoke the license it has been granted. In addition, in some cases criminal liability may even apply.
If a credit institution carries out its activities without a corresponding license, then it is obliged to transfer the profit received from this, as well as the amount of the fine, to the state account.
Legal aspects
Credit organizations in Russia fall under the sphere of influence of the following branches of law:
- constitutional law (we are talking about all the features of the functioning of this institution as a business entity);
- civil law regulates the relationship of credit organizations with other entities;
- if it is a relationship directly with the central bank or other banking institutions, they are subject to banking law.
Bank operations
Credit organizations carry out the following list of banking operations:
- raising funds (for example, in the form of deposits);
- placement of funds in order to extract financial benefits;
- operations with foreign currency and precious metals;
- provision of guarantees.
Also, credit organizations have the right to conclude certain types of transactions:
- surety for third parties;
- requirement to fulfill monetary obligations;
- rental of storage space for valuables;
- banking advice.
Liquidation of a credit institution
The liquidation of a credit institution implies the complete cessation of its existence without providing the possibility of transferring rights to third parties. Confirmation of this procedure is a special mark in the state register, as well as a certificate that is issued on its basis. The entire set of liquidation actions can drag on for up to one year.
It is worth noting that when submitting a petition to the court on the liquidation of a credit institution, an audit is carried out that reveals the purity and accuracy of the reports, as well as all the details of the transactions. The procedure will not be started until all debts on obligatory payments, as well as other obligations, are repaid.
After the tax audit, it’s the turn to create a special liquidation commission, which may consist of employees of the organization, or include persons attracted by it. They conduct all matters regarding the completion of activities, including the sale of property from tenders, as well as the circulation of relevant information in the press.
The liquidation of a credit organization may be made in the following cases:
- by decision of the legal entity itself, in the event that the allotted period for which the object was created has expired, or if the purpose of its functioning has been fully achieved;
- by a court decision, if the license has expired (or it was not obtained at all), in violation of the law, as well as in the case when the organization’s activity does not comply or contradicts its charter;
- by applying to the judicial authorities of third parties whose rights have been violated as a result of the activities of a credit institution.
Goals
If we talk about the purpose of the credit organization, then it is to extract the maximum possible profit from its activities. In this case, it consists of a commission, as well as interest payments on loans provided. A separate item of income can be considered operations with securities.
