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The Ministry of Finance is preparing amendments to the Civil code, to make it easier for banks to close the accounts of customers. We are talking about the so-called dead accounts, which customers do not enjoy for up to two years
As it became known to RBC, the amendments to the Civil code (GK) which would allow banks to close accounts of customers unilaterally, shall be discussed at the level of the Advisory Council for foreign investments (FIAC). Innovation should make life much easier for the bankers who now bear high costs to service such accounts. It is expected that the amendments will be distributed to the accounts of legal entities and individual entrepreneurs.
The bill, which will simplify the banks closing the accounts of the customers unilaterally, were discussed by the participants of the FIAC at the meeting with Prime Minister Dmitry Medvedev on Monday, told RBC two sources familiar with the discussions.
“Yesterday at the Advisory Board discussed the unilateral closure of accounts. Central Bank and MAYOR oversee this issue,” said one of the sources.
One of the participants of the FIAC working group on the development of the banking sector and financial markets, said that the changes are proposed in article 859 of the Civil code, which determines the termination of the Bank account agreement with legal entities. In its current version, the Bank may refuse the execution of the account contract unilaterally in the absence of cash transactions and cash on it for two years. The Bank must warn the client of termination in writing. It is terminated two months after the Bank sent a warning, if the account of the customer for the period the money has not been received.
Changes that are suggested by the working group of the FIAC, lies in the fact that the parties are entitled to specify the Bank account agreement the Bank’s right to unilaterally terminate the contract in the absence of transactions on the account during the period about which the Bank and the customer agree initially — and even if the money in the accounts is still there. On closure of the account will need to pre-notify the client, the balance of funds will be returned according to its instructions, told the source.
The legislation significantly restricts the rights of banks. This attack all listed in the law — the absence within two years of funds in the account and operations on it, as well as a shortfall of funds to the account after the warning of the Bank in practice takes place only in a few cases, say market participants. Most often, the client’s account, the money is there. In their absence, after receipt of the letter from the Bank, at the expense often comes a new amount, forcing the Bank to start the whole procedure from the beginning once the account balance reaches zero again. While the ability to withdraw funds from the account in payment of commissions for the Bank is also limited. As a result, funds are frozen for many years.
The development of the final version of the bill to make it easier for banks termination of Bank account agreements unilaterally now engaged in the Ministry of Finance (contractor), Ministry of economic development, the Ministry of justice and the Bank of Russia (co-executors) with the participation of the banking community, said the representative of the press service of the Ministry of Finance. According to him, to prepare such amendments to the Civil code of the Department assigned by the letter of the government apparatus.
“The work on amendments to the Civil code of the Russian Federation on this subject is part of the FIAC”, — told RBC representative of the press service of the Bank of Russia. The Bank of Russia, for its part, is ready to participate in the work, said the representative of the regulator.
The results of consideration of amendments by the representatives of the banking community, as the analysis of the burden on banks due to existing regulations, the Ministry has not been received, said RBC assistant chief, the MAYOR Elena laskina. In this work to simplify the procedure for closure of accounts by banks is conducted according to the instructions of the first Deputy Chairman of the government, which were given following the meeting of the Executive Committee of the FIAC on 3 June, she added.
The Ministry of justice in the preparation of proposals on expediency of amendments to the civil code did not participate, however, ready to join the consideration of amendments when they are received in the prescribed manner, said RBC representative office. The representative of the Secretariat first Deputy Prime Minister Igor Shuvalov declined to comment.
Annette Fiveg, Chairman of the Board of Deutsche Bank, commenting on the impending rules, said: “tremendous work has been Done, which to date has led to the fact that the Ministry of Finance plans to submit these amendments to the code.”
The issue of unilateral closing of accounts are relevant for all banks, the Chairman of the Board of UniCredit Bank Mikhail Alekseev. Idle accounts with small balances is really a lot, admits Vice-President, head of the financial monitoring service of client operations at VTB 24 Igor Vengerov. He estimates the cost of the Bank for their service as “significant”. “Thus the concept of “service” includes a wide range of activities — from storing customer files to modernization of automated systems of the Bank taking into account the available capacity of the client base (which includes inactive clients)”, — adds Yuri.
According to the requirements of the civil code, the Bank may terminate the customer agreement by sending a notice in the mail, and this requires additional resources, says the head of non-credit products Raiffeisenbank Damien Leclere. According to him, there are several items of expenditure for maintenance of “dead” accounts. “Information systems of the Bank are licensed by the number of accounts and their closing can reduce license fees. For each open account is earmarked resources to support units of the Bank, for example, a call centre,” says LeClair.
In addition, the law requires to regularly update customer data, which increases operational costs, he adds. According to LeClair, expenses, demands and work with the Executive production of the bills: the Bank needs to process all Executive documents (tracing the accounts of arrests, demands), regardless of current balance.