Experts have told how the Ukrainian banks facing distressed status.
In the near future the Ukrainian financial market can leave some more players. On July 11 the deadline for the recapitalisation of small banks. As of may 31, in Ukraine continued 28 financial institutions, which by that time it is necessary to increase its authorized capital to 200 million hryvnas, reported the National Bank of Ukraine. Banks with insufficient capital should be withdrawn from the market.
Journalists told who might be at risk.
In August 2014, in the midst of cleaning the banking system, the national Bank obliged the banks ‘ shareholders to gradually increase the statutory capital of their institutions up to UAH 500 million. Since then, through forced capitalization were all large and medium-sized banks in the country.
Last year, the Bank eased the requirements for recapitalization of small banks, establishing the final schedule 11 Jan. Their owners were given six months to meet the standard.
As of April 1, according to quarterly reports, to the minimum value did not reach 36 banks. Shareholders are part of them managed to Deposit funds or announced plans to recapitalize the financial institution within a specified time.
Banks that require additional capitalization till July 11
Completed the procedure of additional capitalization of eight banks: Trast-Kapital, Bohuslav, Creditwestbank, Citibank, okci Bank, and Concord. A sufficient level of capital, the International investment Bank Petro Poroshenko and Avangard Bank, which belongs to the group of ICU Makar Pasenyuk and Konstantin Stetsenko.
Negotiates capitalization Altbank. “Shareholders made all required contributions in February-April of this year. April 20 General meeting of shareholders of the Bank approved amendments to the Charter related to the increase in share capital up to size 205 million. Currently, the new version of the Charter is under consideration by the NBU,” – said Arsen Soroka, a member of the Board, Director of legal Affairs Altbank.
In the process of approving documents is Ayboks Bank. Early in the third quarter of its Charter capital was at the level of 122,4 million. According to the press service, in may, shareholders made additional 77,6 million. Documents,confirming the capital increase, are in registration with the NBU.
At the finish line of the Bank, Agroprogres. “February 28, 2017, the sole shareholder of Bank agro holding (Ukraine) limited took the decision to increase the Bank’s share capital from 160 to 210 million UAH. Funds in the amount of UAH 50 million was deposited to the account of the Bank on 4 may. May 12 was approved by the Bank’s Charter in a new wording, and on may 18, the Bank submitted to the NBU a package of documents for its approval. The process of recapitalization will be completed within the prescribed period,” the Bank said.
Is there an alternative
To help the remaining banks to cope with the time, the national Bank accelerated the number of procedures. Now the banks within ten days may be allowed for capitalization under the simplified procedure. Shareholders who do not have the ability or desire to support the banks and to meet the standards, the NBU offers to voluntarily surrender the banking license. Yesterday, the regulator also adopted an Ordinance that allows you to stop banking activities without liquidation of a legal entity. Such a process does not put pressure on the Deposit guarantee Fund, do not spoil the reputation of the owners and managers of the Bank and does not oblige them to completely close the business. Format of financial companies they can engage in foreign exchange transactions, maintain billing systems to engage in consumer lending, etc.
Informed decision about liquidation was accepted banks New and Financial partner.
To avoid bankruptcy banks can also by combining with each other. Last week, the NBU added the relevant laws and regulations and has simplified the restructuring of the banks. Now the permission for merger from the regulator you can get for three days and undergo the procedure itself at an accelerated rate. New approach can reduce the process of joining of banks from 1.5 years to 3 months.
Earlier decided to unite two of the Bank’s General shareholder Industrialbank and Express Bank, but the NBU relevant documents have not been received. “We are aware of two banks that have expressed interest in the procedure of reorganization by joining. The national Bank did not receive the official application documents from the banks, wishing to unite,” – said the press service.
To declare the desire to recapitalize their financial institutions or to unite with other members of the banking market still later. “If the Bank have a real plan to replenish capital, the national Bank after the expiration will not immediately make a decision. They give banks the time they need, because the recapitalization or reorganization takes time and depends not only on the NBU, but also from the Antimonopoly Committee. However, if you have 5-6 banks will have problems, it is predictable”, – says the Executive Director of the Independent Association of banks of Ukraine Olena Korobkova.
What threatens the bankruptcy of small financial institutions? Experts believe that the market will not notice the loss. “We can hardly expect any significant impact on the banking sector from the withdrawal from the market of those few banks that are unable to increase their capitalization, given their size and market share,” says Mykhailo Demkiv financial analyst at the ICU group.
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