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Report: 2 pension funds launch court proceedings against Otkritie Bank

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Report: 2 pension funds launch court proceedings against Otkritie Bank

Two companies managing the assets of Russian nonstate pension funds NPF Safmar and NPF Doverie have launched 16.66 billion Russian ruble court proceedings against Otkritie Financial Corp. Bank over losses stemming from their investments into Otkritie Holding JSC bonds, news agency Prime reported Jan. 11.

The two pension fund managers want Otkritie Bank to compensate them for the loss of profit resulting from B&N Bank's failure to repurchase the Otkritie Holding bonds. B&N Bank recently merged with Otkritie Bank, which now acts as its legal successor.

The pension fund managers acquired the Otkritie Holding bonds in 2015 and 2016, and later received an offer for the buyback of the bonds by B&N Bank. They asked B&N Bank to repurchase the bonds in September 2017, after Otkritie Financial Corp. Bank, controlled by Otkritie Holding at the time, was bailed out by the Russian central bank.

However, B&N Bank failed to repurchase the securities because it was also taken over by the central bank and placed into provisional administration, which rejected the buyback request.

The value of the claim lodged is calculated as the difference between the current value of Otkritie Holding bonds and the amount that B&N Bank would have spent on repurchasing the securities, Vedomosti noted the same day.

As of Jan. 11, US$1 was equivalent to 66.97 Russian rubles.