The Individual Deposit Guarantee Fund expects to receive UAH 15 billion from the sale of insolvent banks` assets this year, twice the amount of official targets, according to a statement by Deputy Director of the Fund Andriy Kyiak.
Kyiak says that the National Bank of Ukraine (NBU) has suspended the sale of banks` assets provided as collateral under refinancing loans issued by the regulator, which jeopardizes the fulfilment of claims of creditors of these banks.
”The longer the NBU drags out the approval of the sale of certain property belonging insolvent banks, the fewer chances are left to get money for that property. Any pledgee or mortgagee, the NBU in this case, should exercise its right and recover the property in the form of property rights or the mortgage,” Kyiak said.
Kyiak also stresses the NBU arguments regarding the issue are not entirely clear, since in some cases the regulator seeks to sell assets at a price exceeding their estimated value, which seems implausible amid current circumstances.
”Take, for example, Eurogasbank`s assets. There is a sufficient amount of liquid assets provided for the NBU refinancing: a hotel in Kyiv and a hotel complex in Truskavets. The first property item was estimated by the National Bank itself at UAH 25 million. Later it was instructed to sell it at UAH 170 million. The actual value of the complex in Truskavets is about UAH 70-80 million. It is the market value, which also corresponds to the NBU`s previous estimates. And now the regulator sets the price at UAH 450 million. The question is what has changed in the past few months. Has the economy grown? Or is there the influx of investors?” Kyiak wondered.
At the same time, the deputy director noted that the regulator`s position would not make the Fund give up its plans to sell property of insolvent banks.
”This means that we will still continue to submit the packages of documents for approval by the NBU to dispose assets of insolvent banks that have been pledged for refinancing purposes,” he sums up.
As UaPosition reported earlier, the Individual Deposit Guarantee Fund expects that the sale of assets of insolvent banks pledged under the NBU refinancing loans will resume in April.
Earlier, the Fund announced plans to earn at least UAH 7.6 billion from the sale of assets of bankrupt banks this year, with the reservation that the NBU has ”frozen” the sale of assets provided as collateral under the refinancing loans.
In turn, the NBU said it viewed the activity of the Fund on the sale of insolvent banks` property ineffective, since the volumes of assets on sale accounted for a mere 8% of the volume agreed by the regulator.
In an effort to streamline the banking system, which started in 2014, the NBU declared 63 banks as insolvent institutions that were transferred under administration of the Individual Deposit Guarantee Fund. Since the beginning of this year, the NBU decided to withdraw another five financial institutions from the market, including a decision made jointly with the Finance Ministry to liquidate state-run bank Rodovid Bank.
In the course of two years the Fund has reimbursed over UAH 59 billion in compensation to depositors of insolvent banks and received over UAH 50.5 billion in borrowings.
The National Bank of Ukraine expects that this year the Fund will not require additional funds from the state budget and will ensure payments to bank depositors, using the existing resources, as well as through the sale of insolvent banks` assets.
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