11:03 19.11.2015

Deposit guarantee fund to challenge court ruling declared illegal placing Bank Capital on list of insolvent banks

2 min read
Deposit guarantee fund to challenge court ruling declared illegal placing Bank Capital on list of insolvent banks

The Individuals' Deposit Guarantee Fund plans to file a counterclaim against a ruling of the administrative court of appeals in Donetsk regarding Bank Capital (Kyiv), according to which the ruling of the first instance court, declaring unlawful the decision of the National Bank of Ukraine (NBU) and the fund to place the bank to the list of insolvent banks and introduce temporary administration to the bank, was left unchanged.

The fund said that its website that a group of persons on November 16 blocked access to the bank to the temporary administrator, referring to this court ruling.

According to the report, the NBU resolution to liquidate the bank and the fund's decision to start the liquidation procedure (both documents are dated October 29) are in force.

The fund said that payments to depositors were started from November 4, 2015 and at present, the sum paid has exceeded UAH 170 million.

The fund said that payments will continue.

The fund said that it does not have access to the bank's website, and the information placed on it is unofficial.

As reported, the fund on November 2 replaced the liquidator of Bank Capital, appointing Oleksandr Schadnykh to the post instead of Oleksandr Ilchuk.

The NBU on October 29, at the proposal of the Individuals' Deposit Guarantee Fund, decided to liquidate public JSC Bank Capital

"Despite efforts on the part of the owner of a substantial stake in the bank, the stabilization of the bank's work failed. The reason for this is that the overwhelming majority of the bank's assets and the share of operating capacity remained in temporarily occupied territory and therefore it is impossible to provide cash flows to meet the needs of investors and creditors and the appropriate level of risk management," the central bank said.

The executive directorate of the Individuals' Deposit Guarantee Fund decided to extend temporary administration in Bank Capital on October 19 for one month, until November 20, 2015.

On July 20, 2015, the NBU recognized Bank Capital insolvent.

Bank Capital was established in 1991. In November 2014, the bank moved its head office from Donetsk to Kyiv.

The bank ranked 59th among 127 operating banks as of July 1, 2015, in terms of total assets worth UAH 1.57 billion, according to the NBU.

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