The Bank of Russia’s policy for banking sector rehabilitation and clearance of nonviable and mala-fide players is continuously in the focus of public and expert community attention. Although it is obvious that the objective of supervision is to safeguard depositors and creditors’ rights, experts regularly raise the issue about the impact of license revocation on competition in the banking system and that the proactive supervisory policy might benefit major, mainly state-owned, banks and squeeze small and medium-sized bona-fide banks out of the market. The study below answers these questions, demonstrating long- and short-term effects of proactive supervisory policy on various types of banks.