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ProZorro to launch sale of bankrupt banks' assets in two weeks

The distribution of lots is underway.

The auctions on the sale of assets of bankrupt banks through the ProZorro. Sales system will begin in two weeks, the head of the department of consolidated sales and asset management in the Deposit Insurance Fund Yuliya Bereschenko told a roundtable in Gorshenin Institute on Tuesday, 25 October.

"We started distributing lots last week . We have platforms that are accredited as independent, while others were accredited as part of ProZorro. We are in the process of distribution of new lots," she said.

"For initial auctions we have a period 21 days between the announcement and the actual start for the market to have time to get acquainted with the assets. For re-auctions the term is 10 days. We shall see the sales after new accreditations within the next two weeks," said Bereschenko.

The Fund expects to see the first statistics on volumes of sales via ProZorro will only at the end of November, but the effect of the new system will be seen immediately after the auction.

"Every week, our Fund has received dozens of complaints about auctions, usually about the work of exchanges: non-admission of participants, failed registrations or accusations of manipulations," Bereschenko admitted.

"We hope the first auction on the ProZorro platform will be held in two weeks, and there will be no complaints relating to the deficiencies that we seek to eliminate. We want the sellers on ProZorro dealt with banks and customers, While all the technical part was in the central database, administrated of Transparency International," she said.

If ProZorro. Sales prove its effectiveness, DIF is prepared to move the auctions to this platform after a few months' test, said Bereschenko, to see if the system is devoid of issues of idependent platforms.

ProZorro.Sales is a two-level system, consists of a central database and individual marketplaces. Offer made by a bank, is displayed immediately on all platforms simultaneously. Potential buyers can log in at any of the platforms.

To log in, the participant must pay a guarantee fee, provide financial license and pass the verification. After that, the participant gets access to the auction.

All information about the lot and the auction is public and can be seen by outside observers. Prior to the auction, no one except the administrators of the central database knows how many participants contest, and the size of bids offered by other participants. During the auction, all participants remain anonymous. The bidder offering the larger bid will have an advantage by being allowed to make his move after other participants.

In early October, ProZorro.Sales held a test auction.