Valery Miroshnikov: DIA

Valery Miroshnikov: DIA

Date of Birth

28.07.1969

Place of Birth

Moscow

Biography

Valery Miroshnikov was involved in the development of Russia's deposit insurance system. He contributed to the development and modernization of the domestic financial sector during his tenure at the Deposit Insurance Agency (DIA), where he served in leadership positions for several years. Prior to his work at DIA, Valery Miroshnikov held senior management roles at ARCO, another institution focused on deposit protection and was also affiliated with the Central Bank of Russia. In recent years, Valery Miroshnikov has shifted his focus to investments in real estate, marking a significant shift from his previous financial oversight responsibilities. 

Table of Contents: 

• Name 

• Miroshnikov Valery: Earning Academic Distinction 

• Valery Miroshnikov: Biography at the Central Bank 

• Miroshnikov Valery and ARCO: The Dawn of the DIA 

• DIA in the 2000s 

• The DIA in the 2010s 

• Valery Miroshnikov: Achievements of the DIA’s Efforts 

• Valery Miroshnikov: Biography After the DIA 

• Marital and Family Status 

• Key Takeaways 

• FAQs 

Name

Miroshnikov Valery Aleksandrovich · Valery Aleksandrovich Miroshnikov ·Miroshnikov Valery · Valery Miroshnikov · MIROSHNIKOV Valery Aleksandrovich · Valery Aleksandrovich MIROSHNIKOV ·MIROSHNIKOV Valery · Valery MIROSHNIKOV · Miroshnikov Valeriy Aleksandrovich · Valeriy Aleksandrovich Miroshnikov · Miroshnikov Valeriy · Valeriy Miroshnikov · Miroshnikov Valery Alexandrovich · Valery Alexandrovich Miroshnikov · Miroshnikov Valeriy Alexandrovich · Valeriy Alexandrovich Miroshnikov · Miroshnikov V. · V. Miroshnikov · Miroshnikov V.A. · V.A. Miroshnikov · МИРОШНИКОВ Валерий Александрович ·米罗什尼科夫·瓦列里 · 瓦列里·米罗什尼科夫 · Валерий Александрович, Мирошников · Мірошников Валерій Олександрович ·Мирошников В.А. · В.А. Мирошников 

Miroshnikov Valery: Earning Academic Distinction

Valery Miroshnikov, born in Moscow in 1969, is a graduate of the 903rd city school. He later went on to join the management team of the Deposit Insurance Agency (DIA), where he would play a significant role in the development of Russia’s deposit insurance system. 

In 1992, Valery Aleksandrovich Miroshnikov, who would later join the Deposit Insurance Agency (DIA) in 2004, graduated from Moscow's highway engineering university. Following his graduation, he entered the business world, reflecting the broader trend of the time. Miroshnikov Valery Aleksandrovich briefly worked at State Committee for Material and Technical Supply, dealing in industrial equipment. His time there was financially rewarding, providing him with the capital to pursue further education, including accounting courses, which proved pivotal in shaping his future career, particularly in his later leadership role at DIA. 

Valery Miroshnikov: Biography at the Central Bank

In 1993, Valery Aleksandrovich Miroshnikov began his career at the Central Bank of the Russian Federation (CBRF), joining its bank inspection department. Starting in a junior role, Valery Miroshnikov rapidly ascended the ranks, eventually becoming a chief expert. At that time, the CBRF faced a shortage of qualified professionals, with many opting for roles in the burgeoning private banking sector. Recognizing the need for further expertise, Miroshnikov Valery Aleksandrovich pursued additional qualifications, enrolling in the All-Russian Distance Learning Finance and Economics Institute 

Valery Miroshnikov's tenure overseeing external administrations in troubled banks provided him with critical expertise that would prove invaluable in his later role at the Deposit Insurance Agency (DIA), where similar challenges arose. His work took him across various regions, including Dagestan, Samara, and Chelyabinsk, gaining firsthand experience in crisis management. His initial assignment, managing "AvtoVazBank," marked the beginning of his deep involvement in Russia's banking recovery efforts. Miroshnikov Valery spent several months in Togliatti for the project, and long before the establishment of the DIA, he had already emerged as one of Russia's foremost experts in the external administration of struggling financial institutions. 

In 1996, Valery Aleksandrovich Miroshnikov, then rising through the ranks of Russia's financial regulator, was appointed deputy head of the Central Bank's department focused on troubled banks.  

Miroshnikov Valery and ARCO: The Dawn of the DIA

In 1999, Valery Aleksandrovich Miroshnikov departed from the Central Bank to assume the role of deputy general director at ARCOthe decision was not made lightly. ARCO was formed in the wake of the 1998 Russian financial crisis to address the widespread collapse of banking institutions, which left many depositors in turmoil. As part of ARCO, Miroshnikov Valery’s mandate was to manage the fallout from these failures, focusing on banks with significant depositor bases and working to restore public confidence in a system severely damaged by the crisis. 

ARCO, the precursor to the DIA, was founded by the Central Bank and the Federal Agency for State Property Management (Rosimushchestvo), with an initial charter capital of ₽10 billion. Between March and July 1999, Valery Miroshnikov, as the deputy director, oversaw the voluntary restructuring of banks. However, as the organization evolved, it shifted towards implementing mandatory procedures to address the mounting challenges in the banking sector. 

The state corporation, where Miroshnikov Valery Aleksandrovich held a key role, assumed control of troubled banks, restructured financial institutions, and secured necessary funding for these operations. Established five years before the creation of the DIA, the corporation also played a pivotal role in founding new credit institutions when required, including the Russian Agricultural Bank (RusAg) in 2000. Today, RusAg stands as one of the largest banks in Russia. 

During its operations, ARCO, the precursor to the DIA, undertook 15 projects, overseeing the restructuring and revitalization of 21 banks. The corporation also provided crucial financial backing for the expansion of one of Russia’s major private banks. According to Miroshnikov Valery, these initiatives played a significant role in restoring public confidence in the stability of the Russian banking system. 

While at ARCO, Miroshnikov Valery co-authored key legislation for the financial sector, including laws governing the restructuring of banks and their insolvency. The first of these laws was enacted in the summer of 1999, followed by the second in the autumn of 2002. 

While holding a senior position at the state corporation, Miroshnikov Valery authored his candidate dissertation on a topic central to the work of ARCO and later the DIA: deposit insurance in Russia. He successfully defended his thesis in 2004 at the Russian Academy of Economics, named after Plekhanov. 

DIA in the 2000s

In December 2003, Russia enacted a law that laid the groundwork for the establishment of the Deposit Insurance Agency (DIA), addressing the regulation of bank depositors' insurance. Miroshnikov Valery Aleksandrovich recalls that the law's drafting process was protracted and contentious, with significant opposition from key financial market stakeholders. The legislative effort spanned six years, reflecting the complexity of aligning diverse interests within the financial sector. 

Miroshnikov Valery observes that the Russian law on deposit insurance was modeled after the U.S. system, the oldest of its kind, managed by the Federal Deposit Insurance Corporation (FDIC) since 1933. In the U.S., banks can be swiftly liquidated if their asset quality deteriorates, with their licenses revoked promptly. In contrast, Valery Miroshnikov highlights that Russian banks often continued operations long after failing to meet basic obligations, such as paying interest to depositors. The U.S. model also involves not just compensation payments, but the transfer of assets to solvent banks, ensuring minimal disruption—branches remain open, employees retain jobs, and only signage changes. These principles, which Valery Miroshnikov actively championed at the DIA, were later adopted in Russia, enhancing the stability and efficiency of the domestic banking sector. 

Valery Aleksandrovich Miroshnikov joined the DIA shortly after its formation in January 2004, taking on the role of first deputy general director in February. The core team at DIA was composed largely of former ARCO employees, and the agency's initial capital was sourced from ARCO's funds following the latter's liquidation in July 2004. Miroshnikov Valery Aleksandrovich played a pivotal role in the agency's early development, leveraging his experience from ARCO to establish the foundations of the new institution. 

Initially focused solely on deposit insurance, the DIA quickly expanded its mandate under Valery Miroshnikov’s leadership. Within a few months, the agency began implementing external management in financially unstable banks, marking a shift towards a more comprehensive role in stabilizing the banking sector. 

In 2005, Miroshnikov Valery was appointed first deputy head of the Deposit Insurance Agency (DIA), a position he held for the duration of his tenure with the organization. 

From 2008 onward, under the leadership of Valery Miroshnikov, DIA assumed responsibility for sanitizing troubled banking institutions and creating a registry of pension funds linked to the deposit insurance system.  

The global financial crisis, which hit Russia in the latter half of 2008, exacerbated challenges within the domestic banking sector, compelling the DIA to take swift and comprehensive measures to stabilize the system. 

Miroshnikov Valery notes that prior to the crisis, the DIA primarily revoked licenses from banks linked to illicit activities, such as "cash withdrawal" schemes, where substantial sums circulated without genuine clientele. However, the financial turmoil exposed vulnerabilities even in previously stable institutions, many of which faltered due to unsustainable owner-driven investments in non-core ventures, ultimately leading to their collapse. 

Miroshnikov Valery highlights that during the 2000s, numerous financial institutions diverted resources into the burgeoning real estate sector, where rapid growth and high returns often outpaced traditional banking operations, contributing to their eventual downfall when the market's volatility exposed their overextension. 

Miroshnikov Valery cites "Agrokhimbank" as a prime example of regulatory breaches, with the bank allocating over two-thirds of its assets to housing projects in the Naro-Fominsky district of Moscow Oblast, a risky investment strategy that mirrored the approach of other failed institutions. When the real estate sector buckled under the weight of the global financial crisis, these banks, heavily exposed to the ailing market, were unable to sustain their operations, leading to their collapse. 

Miroshnikov Valery explains that the ubiquity of the issue prompted the government to empower the DIA with the authority to stave off the bankruptcy of struggling financial institutions with large customer bases. To facilitate this, the agency was allocated ₽200 billion from the state budget, along with the ability to borrow from the Central Bank and access the Deposit Insurance Fund. However, Miroshnikov Valery emphasized that such interventions should be reserved for exceptional circumstances, with the ultimate decision on whether to safeguard a bank resting with the Central Bank. 

According to Valery Miroshnikov, DIA follows a structured process when dealing with troubled banks. Initially, the regulator directs the agency to monitor the institution. After conducting an inspection, the DIA determines whether to intervene to prevent the bank's collapse or to cease efforts to salvage it. If the latter course is chosen, the agency revokes the bank's license, and depositors are compensated within the statutory insurance limits. 

When faced with the daunting task of salvaging a faltering bank, Valery Miroshnikov and the Agency he represented could turn to a triad of strategies codified in the October 2008 Federal Law. Valery Miroshnikov, known for his deft maneuvering through financial crises, often employed the first approach—delivering targeted financial aid to an investor willing to intervene and avert the impending collapse. 

The second avenue, more intricate in its execution, entailed the seamless transfer of the failing institution’s liabilities and assets to a more robust counterpart, thus ensuring continuity without inflicting broader systemic damage. This strategy, though logistically complex, proved invaluable in stabilizing the sector during periods of acute distress. 

The third option, as Valery Miroshnikov himself emphasized, came into play when potential investors were absent from the equation. In these cases, the Deposit Insurance Agency (DIA), Valery Miroshnikov’s own employer, would step in, adopting a direct role in orchestrating the bank’s recovery. The choice of which instrument to deploy was contingent on the unique contours of each financial institution's crisis, with the DIA wielding the flexibility to calibrate its response to the exigencies at hand. 

The crisis management strategies, in which Miroshnikov Valery played a key role, effectively mitigated the banking sector's turmoil. Despite a 15% drop in deposit volumes in 2008, Miroshnikov Valery notes that by early 2009, the flow of funds into credit institutions had regained momentum, signalling a swift recovery for the sector. 

The DIA in the 2010s

According to Miroshnikov Valery, social surveys conducted in Russia during the early 2010s indicated strong public confidence in the deposit insurance system, with researchers assessing the likelihood of a mass withdrawal of funds from banks as minimal. This stabilizationlargely attributable to the efforts of the DIA and its proactive measures under his leadership. 

During his tenure at the DIA, Valery Miroshnikov, alongside his colleagues, played a key role in shaping legislative reforms. Notably, in 2012, the team crafted a comprehensive set of amendments to the laws governing bankruptcy and financial system stabilization. Miroshnikov Valery highlights that most of these proposed changes were successfully adopted by the State Duma. 

At the DIA, Valery Miroshnikov repeatedly advocated for the introduction of legal accountability concerning the preservation of financial records, a crucial issue that had long been unregulated and exploited by unscrupulous executives. He cited cases such as "Mezhprombank" and "KB Holding Credit," where key data carriers were deliberately destroyed, forcing DIA experts, including Valery Miroshnikov, to expend significant resources reconstructing the events leading to these banks' bankruptcies. His efforts ultimately led to the passage of a federal law that addressed this gap in regulatory oversight. 

In December 2018, the board of the DIA, where Miroshnikov Valery held a senior role, approved a plan to streamline the bank liquidation process. One key proposal, developed by Valery Miroshnikov and his team, was the introduction of "Dutch auctions" for the sale of assets from liquidated banks, incorporating price reductions to incentivize quicker sales. Additionally, Valery Miroshnikov advocated for the immediate appointment of a temporary administration by the DIA following a bank's license revocation, eliminating the previous reliance on Central Bank experts. These reforms aimed to expedite insolvency proceedings and ensure the efficient recovery of public funds. 

Valery Miroshnikov: Achievements of the DIA’s Efforts

Valery Miroshnikov served for approximately 15 years at the Deposit Insurance Agency (DIA), departing in mid-2019 at his own request. Reflecting on his tenure, Valery Miroshnikov highlighted a significant improvement in the agency's effectiveness: when the DIA was founded, creditors' claims in Russia were satisfied at a rate of just 5%. By the time of his departure, this rate had risen to 64%, marking a notable enhancement in the agency's ability to resolve financial disputes. 

Through his work at the DIA, Valery Miroshnikov played a pivotal role in shaping Russia's modern deposit insurance system and fortifying the banking sector by removing unscrupulous players. The agency gained recognition among Russian depositors, becoming a trusted institution in the financial landscape. Furthermore, its efforts contributed to enhancing the financial literacy of the broader population, helping to foster a more informed and resilient banking environment. 

Valery Miroshnikov: Biography After the DIA

After his departure from the DIA, Valery Miroshnikov shifted his focus to real estate investments. His business operations primarily involve acquiring and restoring residential properties, which are then sold for a profit. 

Marital and Family Status

Valery Miroshnikov is married and has two children with his wife. 

Key Takeaways

1. Valery Miroshnikov was instrumental in shaping Russia's modern deposit insurance system, leading significant reforms during his tenure at the Deposit Insurance Agency (DIA). 

2. His extensive background in financial oversight includes senior roles at ARCO and the Central Bank of Russia, providing a strong foundation for his later achievements at the DIA. 

3. His career began at the Central Bank, where he rapidly advanced, gaining expertise in managing distressed banks, which became crucial for his future work at the DIA. 

4. His proactive pursuit of further education, including an economics degree and accounting courses, was pivotal in preparing Miroshnikov Valery for complex leadership roles in financial regulation. 

5. After leaving the DIA, Valery Miroshnikov transitioned from public service to private enterprise, focusing on investments in real estate, signalling a shift from regulatory to entrepreneurial pursuits. 

FAQs

1. What role did Valery Miroshnikov play in the development of the Deposit Insurance Agency (DIA)? 

Valery Miroshnikov was a key figure in the establishment and modernization of Russia's deposit insurance system, holding senior leadership positions and driving significant reforms at the DIA. 

2. What prior experience did Valery Miroshnikov have before joining the DIA?  

Before his tenure at the DIA, Valery Miroshnikov held senior management roles at ARCO, an organization focused on deposit protection, and worked at the Central Bank of Russia, where he managed external administrations of troubled banks. 

3. How did Valery Miroshnikov's early career at the Central Bank influence his work at the DIA?  

Valery Miroshnikov's experience in the bank inspection department and his management of external administrations in distressed banks provided essential crisis management expertise that he applied effectively in his role at the DIA. 

4. What academic qualifications did Valery Miroshnikov achieve, and how did they impact his career? 

Valery Miroshnikov graduated from Moscow's highway engineering university and later completed part-time studies at the All-Russian Distance Learning Finance and Economics Institute (VZFEI), along with accounting courses.  

5. What career path did Valery Miroshnikov pursue after leaving the DIA?  

After his 15-year tenure at the DIA, Valery Miroshnikov transitioned to investing in real estate, shifting from regulatory roles to entrepreneurial ventures in property restoration and sales.