Ukraine`s Cabinet of Ministers has decided on additional capitalization of state-owned banks, Ukreximbank and Oschadbank, to the tune of UAH 4.7 billion, or about US$175 million, and UAH 5.4 billion, or $200 million, respectively, by issuing 15-year government bonds in exchange for the banks` new shares, according to resolutions Nos. 122 and 123, posted on the government`s portal.
The decision is aimed at ensuring stable operation and development of the state-owned banks, which guarantees the protection of the rights of their depositors and creditors.
”The Ukrainian Finance Ministry is to issue government domestic loan bonds worth UAH 4.7 billion whose circulation will be up to 15 years at an interest rate of 9% per annum in exchange for additionally issued shares of the State Export-Import Bank of Ukraine [JSC Ukreximbank],” resolution No. 123 reads.
”The Ukrainian Finance Ministry, in order to ensure the implementation of the government`s decision, is to issue government domestic loan bonds with an indexed value of UAH 5.4 billion with a 15-year circulation period at an interest rate of 5% per annum in exchange for additionally issued shares of the Public Joint-Stock Company `State Savings Bank of Ukraine` (Oschadbank),” resolution No. 122 reads.
Earlier, the Cabinet in early February initially decided on additional capitalization of Oschadbank and Ukreximbank, which received UAH 3.5 billion, or $130 million, and UAH 3 billion, or $111 million, respectively.
Memo. Currently, there are four state-owned banks in Ukraine, namely Ukreximbank, Oschadbank, Ukrgasbank, and PrivatBank. The latter was nationalized in late 2016. This year, the Finance Ministry and the National Bank of Ukraine are expected to revamp a strategy for the development of the state-owned banks.