The Central Bank of Russia Revoked the License of Qiwi Bank — a Subsidiary of a Publicly Traded Payment System Qiwi Plc

The Central Bank of Russia has revoked the license of Qiwi Bank — a subsidiary of a publicly traded payment system Qiwi Plc (NASDAQ: QIWI). On March 15, 2023, QIWI received a notice from the Listing Qualifications Staff of Nasdaq indicating that the staff had determined to delist the Company’s American Depositary Shares from the Nasdaq Global Select Market.

On March 21, 2023, however, the Company requested a hearing to appeal the staff’s determination to delist, which was held on April 27, 2023. The Company presented to the hearing panel its restructuring plan aimed at decoupling of the Russian and International perimeters and addressing various shareholders concerns. On June 6, 2023, the panel granted the request of the Company to continue its listing on Nasdaq, subject to certain conditions.

Russia has a fairy-tale banking and supervisory system. Half of the banks are under sanctions and for this reason foreign and hard currency transactions, as well as external use of plastic cards — and now card issuance — are virtually impossible. Those small functioning banking and quasi-banking organizations are being methodically bashed by the Central Bank — characteristically, as it is customary nowadays, in a directive manner, without any investigations or appeals to shareholders in order for the latter to conduct extraordinary meetings to sort out corresponding transparency issues.

In this particular episode, the CBR stated the following Qiwi’s misconducts: Repeated violations of Russian law and “systematic” disregard of anti-money laundering regulations are pointed out. Its focus on risky operations, including interaction with shadow businesses and making payments in favor of illegal online casinos, has been noted. Unauthorized opening of QIWI wallets and transactions without the owners' knowledge were identified, thereby threatening the financial security of its users.

Qiwi Bank had no significant impact on lending to the real economy, ranking 89th in terms of assets among Russian banks.