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. Last Updated: 07/27/2016

Imperial Wins Back Banking License

The Central Bank on Monday restored the license of Bank Imperial, once one of Russia's 10 largest banks, saying the bank could operate at least until Oct. 7.

Imperial lost its license in the wake of the last August's financial collapse, which left most of Russia's 1,400 banks unable to pay their debts.

The decision to restore the license means the bank can resume business. But 10 days before the Oct. 7 deadline, the Moscow branch of the Central Bank of Russia will have to issue a final verdict regarding the bank's future - to liquidate it and partially pay off creditors, or restore the license permanently and let the bank continue.

The request to restore the license was signed by Vyacheslav Sheremet, who is first deputy chairman of natural gas monopoly Gazprom; LUKoil President Vagit Alekperov; the Zarubezhneft oil company; and Fuel and Energy Minister Viktor Kalyuzhny.

"We supported the request sent to the Central Bank," said Dmitry Dolgov, spokesman for LUKoil, declining to provide further information.

It wasn't clear why the three companies and the ministry wanted the bank to return to operation.

Gazprom is not owed significant amounts of money, the Bank Imperial says.

Vyacheslav Medvedev, the bank's former court-appointed temporary manager, has said in a letter to the Central Bank that LUKoil had borrowed $300 million from the bank. But LUKoil's position is that it is in fact a creditor of Imperial.

The Fuel and Energy Ministry is owed $180 million in hard currency reserves and another $30 million on its current account, an official in the ministry said.

Bank Imperial President Vladimir Forosenko said LUKoil owed the bank about $100 million.

Under former Fuel and Energy Minister Sergei Generalov, the ministry kept saying Imperial was insolvent and should be should be liquidated.

Under new minister Kalyuzhny, however, the ministry's attitude toward the bank has changed.

Forosenko said that the would be able to pay its debts and resume doing business.

"It's just a matter of how the bank will operate in future," he added.

Within a month Imperial's creditors will meet to discuss the plan for the bank's recapitalization.