UPDATE 2-Russia puts subsidiary of Ukraine's Privatbank in temporary administration

* Putin has called co-owner of Privat group “impostor”

* Chairman confident central bank will back Moskomprivatbank

MOSCOW/KIEV, March 6 (Reuters) - The Russian central bank said on Thursday it was putting the Moscow subsidiary of Ukraine’s Privatbank into temporary administration, but that it would not revoke the bank’s licence.

Russia and Ukraine are in a dangerous armed stand-off following months of unrest in Kiev and the ousting of President Viktor Yanukovich. Moscow has refused to recognise the new government in Kiev, although President Vladimir Putin has instructed his government to establish contacts.

Privatbank is a part of Ukraine’s Privat group, co-founded and co-owned by Igor Kolomoisky, who was appointed by Ukraine’s Acting President Oleksandr Turchinov as governor of Dnipropetrovsk region, Kolomoisky’s birthplace, a few days ago.

Putin on Tuesday called Kolomoisky “a unique impostor”, accusing him of violating a contract with Russian businessman Roman Abramovich.

“And such a scoundrel was made a governor of Dnipropetrovsk region,” the Russian president told a press briefing in which he talked about widespread corruption in Ukraine. Putin did not elaborate which business deal between Abramovich and Kolomoisky he was referring to.

The central bank said in a statement the decision to appoint an interim administration for Moskomprivatbank, Russia’s No.95 by assets according to Interfax data, was effective immediately.

“The role of the temporary administration is to oversee the lending institution and to control the disposal of its property,” the central bank said in a statement.

Privatbank, founded in 1992, is Ukraine’s largest. According to public information, Kolomoisky owns a 33.9 percent stake in the bank and his business partner Gennady Bogolyubov 34.2.

Kolomoisky held just over 2 percent in Russia’s largest steel producer Evraz, of which Abramovich is the largest shareholder, as of early 2013. There is no public information available on Kolomoisky’s current stake in Evraz.


Elvira Nabuillina, Russia’s central bank head since last year, has started to tighten regulation of the domestic banking system, which consists of around 1,000 banks, in a wider move to tackle the shadow economy.

Since Nabuillina became central bank governor over 30 banking licenses have been revoked, notably Master Bank, which cost the state about 30 billion roubles in retail deposit insurance payments, Russia’s largest pay-out to date.

Moskomprivatbank, with assets of 50 billion roubles ($1.4 billion), has capital requirement ratios above the levels required by the Russian central bank to keep a banking licence.

According to the central bank’s data for January, the latest available, it had no violations of capital requirements.

The central bank declined to comment further.

Dmitry Barbayanov, chairman of Moskomprivatbank, said in a statement on Thursday that interim administration - a rare move by the Russian central bank - would last 10 days. He said it had “no economic grounds” and aimed to help the bank to meet “high clients’ demand” if it arises.

“We are sure that the central bank will throw its weight behind Moskomprivatbank and won’t allow politicians to break the normal regime of client service,” he said in a statement.

Kolomoisky, 51, is ranked the third richest man in Ukraine with an estimated fortune of $2.4 billion, according to Forbes.

He co-founded the Privat metals and banking group, which runs a number of oil, gas and steel companies.

On Thursday, Crimea’s parliament voted to join Russia and Crimea’s Moscow-backed parliament set a referendum on the move within 10 days in a dramatic escalation of the crisis over Crimea’s status.