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Risk of loss of business reputation (reputational risk)

Credit Institution Reputation Risk (Reputational Risk) means the credit institution 's risk of loss due to factors that we will consider below.

Business reputation of credit institution - qualitative assessment by participants of civil turnover of activity of credit institution, as well as actions of its real owners, affiliates, subsidiaries and dependent organizations.

The following internal and external factors may cause a reputation risk:

  • Non-compliance by credit institution (affiliates of credit institution, subsidiaries and affiliates, real owners of credit institution) Legislation of the country, constituent and internal documents of the credit institution, customs of business turnover, principles of professional ethics, non-fulfillment of contractual obligations to creditors, depositors and other clients and counterparties, absence of mechanisms in internal documents that allow to effectively regulate conflict of interests of clients and counterparties, founders (Participants), management bodies and (or) employees, as well as minimize the negative consequences of conflicts of interest, including the prevention of complaints, legal actions by clients and counterparties and (or) the application of measures of influence by regulatory and supervisory bodies.
  • Failure of the credit institution, its affiliates, as well as the real owners to effectively counteract the legalization (laundering) of proceeds of crime and the financing of terrorism, as well as other illegal activities carried out by unscrupulous clients and counterparties and/or employees of the credit institution.
  • Deficiencies in bank risk management of the credit institution, resulting in potential damage to business reputation. Implementation by the credit institution of risky credit, investment and market policies, high level of operational risk, shortcomings in the organization of the internal control system, including in order to counter legalization (laundering) of proceeds of crime and financing of terrorism.
  • Recruitment and placement shortcomings, failure to comply with "Know your employee".
  • The credit institution has a conflict of interest with the founders (participants), clients and counterparties, as well as other interested persons.
  • Publication of negative information about credit institution or its employees, founders (participants), members of management bodies, affiliates, subsidiaries and dependent organizations in mass media.


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