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Economy 2020-10-15T05:12:08+03:00
Ukrainian news
Financial Stability Council States Smooth Running Of PrivatBank And Financial Sector

Financial Stability Council States Smooth Running Of PrivatBank And Financial Sector

IMF, EBRD, World Bank, PrivatBank, Financial Stability Council

The Financial Stability Council held an extraordinary meeting with the participation of representatives of the International Monetary Fund (IMF), the World Bank and the European Bank for Reconstruction and Development (EBRD) and states the smooth running of PrivatBank.

The NBU said this in a statement, Ukrainian News Agency reports.

Council members discussed the potential impact of the court decision on the illegality of the nationalization of PrivatBank on the financial stability and agreed on further actions.

The meeting participants stated that after the decision of the Kyiv District Administrative Court on the illegality of withdrawal of the insolvent PrivatBank from the market, the situation remains calm and controlled.

The bank works as usual, fully and timely fulfills all obligations to customers.

At the same time, a respective court decision creates legal uncertainty and, consequently, potential risks to financial stability in Ukraine in the future.

This court decision also makes it difficult to cooperate with international financial organizations, in particular the IMF, the World Bank and the EBRD, as well as protecting the interests of the state in lawsuits in other jurisdictions for damages caused to the bank and the state by the former owners of PrivatBank.

Taking into account these risks, the Council members decided the following: the National Bank will continue to constantly monitor the status of PrivatBank; the NBU, the Ministry of Finance and the DGF will seek to maximize the openness and transparency of the appeals process of the court decision; the NBU and the Ministry of Finance will handle the possibility of removing the "banking secrecy" stamp from information regarding non-performing loans (NPLs), as well as operations that led to the appearance of non-performing loans in state banks.

As Ukrainian News Agency earlier reported, on April 18, the District Administrative Court of Kyiv canceled the nationalization of PrivatBank, and also decided on the procedure for the nationalization of PrivatBank in case No.826/13813/17, which was fully satisfied with the claim of the Cypriot company Triantal Investments Ltd, which is under control of Kolomoiskyi.

In particular, the claims of the plaintiff were satisfied in part of the cancellation of the decision of the National Bank No.105 dated December 13, 2016, which determined the list of individuals and legal entities related to PrivatBank.

This is exactly the NBU's decision which has been one of the major ones in the process of withdrawal of insolvent bank PrivatBank from the market with the participation of the state in December 2016.

In the course of this process, a “bail-in” procedure was carried out, consisting in exchanging funds of persons related to the bank for bank shares with subsequent sale to the Ministry of Finance.

The court decision has not yet entered into legal force and in the near future will be appealed by the NBU on appeal.

Also, on April 20, the Pecherskyi District Court of Kyiv decided to terminate Ihor Kolomoiskiy's personal guarantee agreement on PrivatBank's refinancing loans received before state entered the capital of the bank.

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