NBU Classifies Megabank As Insolvent
The Board of the National Bank has decided to classify Megabank as insolvent.
This is stated in the message of the NBU, Ukrainian News Agency reports.
The bank is classified as insolvent due to the bank's failure to conduct its activities in accordance with the requirements of legislation, including regulatory legal acts of the NBU, after classifying it as problematic and the bank's failure to comply with the NBU's requirement to eliminate violations of regulatory legal acts of Ukraine within the period specified by the regulator.
Problems in the bank's activities were not caused by the introduction of martial law.
They began long before the outbreak of war.
On February 3, 2022, the Board of the National Bank of Ukraine, guided by Article 75 of the Law of Ukraine "On Banks and Banking Activities," decided to classify Megabank as problematic.
Among the reasons for classifying the bank as problematic were:
- significant violations of regulatory legal acts of the NBU in terms of credit risk assessment,
- systematic lending to related persons,
- a significant amount of non-core assets on the balance sheet,
- failure to fulfill the plan of additional capitalization/restructuring based on the results of the stress test of 2021.
The National Bank of Ukraine, based on the results of banking supervision over the activities of Megabank, has repeatedly drawn the attention of the bank's management and its shareholders to the presence of potential risks in the bank's activities.
The share of the financial institution amounted to 0.46% of the net assets of solvent banks.
As Ukrainian News Agency earlier reported, Megabank was founded in 1990. Its largest shareholder is Viktor Subbotin (60.9% of its shares).
The European Bank for Reconstruction and Development owns a 15% stake in Megabank, the German state bank KfW owns 15%, and the International Finance Corporation 6.02%.
In April 2022, the amount of funds received by banks liquidated by the Deposit Guarantee Fund amounted to UAH 4.4 million.