Dispute of ROSNO and UralTransBank to be discussed at Federal Insurance Surveillance Agency meeting

According to the spokesperson of the Federal Insurance Surveillance Agency, one more meeting devoted to the independent examination of damage done to UralTransBank conducted by FBK Company Ltd. (an auditing and consulting firm) at the request of ROSNO, the insurance company, will be held tomorrow. The meeting is expected to be attended by the representatives of the Association of Regional Russian Banks, Russian Union of Car Insurers, ROSNO, UralTransBank, and some executives of the Federal Insurance Surveillance Agency.

The dispute originally started with both parties accusing each other of failing to meet the general agreement requirements regarding credit risk insurance related to consumer loans. UralTransBank claimed that the insurer had been paying no bad debt compensation since April 2006. In the meantime, ROSNO accused the bank of not producing enough papers needed to identify and confirm these debts as insured events.

UralTransBank appealed to the Federal Insurance Surveillance Agency, which made the latter hold a special meeting on December 7, 2006 that resulted in the Agency strongly recommending that ROSNO conduct an independent examination of the accrued loss. FBK Company Ltd. was to send its report to the Federal Insurance Surveillance Agency, the All-Russian Union of Insurers, and to the Association of Regional Russian Banks.

ROSNO refused to produce the report at UrBC’s request; meanwhile, Vice President of Russia Association Alexander Stroganov and the representative of the All-Russian Union of Insurers said they had received no report from FBK Company Ltd.

Russian analysts say this conflict threatens to destroy the image of the two companies as well as that of the whole banking and insurance service market.

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