The National Bank has classified Bank Sich Joint Stock Company as insolvent.
This is stated in the NBU message, Ukrainian News Agency reports.
"Bank Sich JSC is classified as insolvent. Such a decision was made in connection with the failure of the bank to fulfill its obligations to the National Bank on refinancing loans within the period established by the contract due to insufficient funds," it notes.
The National Bank emphasizes that according to Article 76 of the Law "On Banks and Banking Activity," failure to fulfill obligations to the lender due to lack of liquidity is the basis for classifying the bank as insolvent.
According to the report, the owners of Sich Bank's significant participation did not take effective measures to improve its financial condition to ensure the ability to fulfill their obligations to the National Bank within the period prescribed by the contract.
In addition, it was taken into account that the activities of this bank were characterized by a poor quality corporate governance system, an inefficient business model, the implementation of risk transactions, which is confirmed by unprofitable activities and negative dynamics of capital standards of the financial institution.
The NBU emphasizes that the classification of the bank as insolvent in no way affects the stability of the banking sector of Ukraine.
The share of the financial institution as of August 1, 2022 was 0.3% of the net assets of solvent banks.
Each depositor of Sich Bank will receive a refund from the Deposit Guarantee Fund in the full amount of the deposit, including interest accrued at the end of the day preceding the day of the start of the bank's withdrawal from the market.
In general, the possible amount of payments of the guaranteed amount to depositors as of July 1, 2022 is UAH 1,229.7 million.
As Ukrainian News Agency earlier reported, 55.62% of the shares of Sich Bank belong to Oleh Balanda, another 31.02% to Valerii Razdorozhnyi.
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