The National Bank of Ukraine (NBU) has removed PricewaterhouseCoopers (audit) LLC (Kyiv, the Ukrainian structure of PwC) from the register of audit forms that have the right to conduct audit of banks, the central bank has said on its website.

The decision was made by the NBU board on Thursday under an application of the NBU bank audit committee.

The rationale behind this decision was PricewaterhouseCoopers Audit LLC’s verification of misrepresented financial information in the financial statements of PrivatBank (Kyiv). In particular, this concerns information on credit exposure and regulatory capital reported by the bank.

"The audit report issued by PricewaterhouseCoopers Audit LLC failed to highlight the credit risk exposure faced by PrivatBank, which led to the bank being declared insolvent and nationalized, with substantial recapitalization costs borne by the state," the central bank said.

The NBU is authorized to remove accounting firms from the register of banks’ auditors in accordance with Article 7 of the Law of Ukraine On the National Bank of Ukraine, Article 70 of the Law of Ukraine On Banks and Banking and NBU regulations.

The regulator’s practice of barring accounting firms from auditing banks is in line with international approaches and is in compliance with the 27th principle of the Basel Core Principles of Banking Supervision.

In 2015-2016, the NBU barred nine accounting firms from auditing banks for audit policy violations.