L.Purevdorj called the citizens to have faith and reconsider to take back their deposits in the new bank because Finance Ministry and Mongolbank are behind its operations.
Mongolbank is now working to ensure stable operations and find the bad loans of MNT 60 billion. Zoos Bank’s loss reached MNT 87.9 billion in total. Foreign experts will take over the operations of the Government Bank.
Ben Torrenbol promised to operate the bank with new structure and professional team. He also said Government’s decision to establish the State Bank was right. The employees of the Zoos Bank can stay in their positions by making new contracts.
Mongolbank stated that State Bank will not have special status or rights because it is owned by the Finance Ministry.
The Central Bank is also planning to abolish Anod Bank this week and transfer the actives to the State Bank. The director of the bank is yet to be clear. Mongolbank is blamed for taking wrong policies for the troubled commercial bank by injecting MNT 150 billion but only earning MNT 40 million. Announcing a bankruptcy for commercial banks is made by court organization. Thus the Central Bank decided to abolish the banks.
Director of Mongol Gazar Company Ts.Myanganbayar is said to be behind the financial problems of the two commercial banks by taking loan of MNT 60 billion in the name of his companies. Sources suggest that he is being investigated. According to facts Ts.Myanganbayar spent most of the money on casinos.
The officials are now looking for ways to cover the damage caused by Ts.Myanganbayar. They are considering to take Mongol Gazar Company and imprisoning Ts.Myanganbayar or to raise money from his Olon-Ovoot mine which was mortgaged in the two banks. Sources suggest that a team led by Central Bank president L.Purevdorj headed to Umnugobi province to study the Olon-Ovoot deposit.
Even though the Mongolbank is saying the problems in the banking sector is being solved, huge amount of bad loans are still there.
National Statistics Bureau said bad loans in the banking sector reached MNT 406.1 billion which accounts for 15.5 percent of total loan payments in October, up by 2.1 percent compared to the previous month and by 4.9 times from same period of last year.
