Structured products. Growth of assets of financial institutions. Limiting the sale of complex products to unqualified investors. Risks, consequences. Legal advice.
The assets of financial institutions in the Russian Federation increased in 2020, continuing the trend of recent years, despite the pandemic. The bulk of the total assets of Russian financial institutions are still banks, while the share and size of assets of non-banking financial institutions, mainly associated with the asset management industry, have clearly increased. The main trends and results of market development are presented in the Review of the Financial Sector and Financial Instruments of Russia, published by the Central Bank.
In 2020, the number of people who bought financial instruments alternative to bank deposits for the first time increased. Demand from individuals for structured products has increased, and at the same time, the risks of missale have increased. This required the Bank of Russia to limit the sale of complex products to unqualified investors, who may not be fully aware of the risks associated with such products, the regulator recalls.
The main reason for the suddenly awakened desire of Russians to invest in securities is disappointment in bank deposits, the rates for which have fallen almost to the level of inflation.
Vitaly Vetrov, managing partner of the law firm Vetrov and Partners, believes that this creates an increase in the risks of losses for individuals themselves. There may be situations of challenging such transactions, recovery of damages.
However, given the sphere itself, the limited expertise in it, it is extremely difficult to terminate the contract, recover damages or come up with other requirements and achieve what you need is extremely difficult. In this regard, is it possible to consider euphoric retail investors as a weak party, which, in case of problems, needs additional help and comprehensive protection? In my opinion, no. Conscientiousness, reasonableness and prudence are still basic principles that should prevail over understandable greed and earn more from existing assets.
We will be happy to provide you with legal assistance regarding the minimization of legal risks and available opportunities. We will try to find a solution that is right for you.
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