18:03 23.05.2019

NBU will be forced to again declare PrivatBank insolvent if court decision to abolish its nationalization executed

2 min read
NBU will be forced to again declare PrivatBank insolvent if court decision to abolish its nationalization executed

 The practical implementation of the court decision to abolish the nationalization of PrivatBank will result in the annulment of the relevant decisions of the National Bank of Ukraine (NBU) and the government and the return of UAH 155 billion by the bank that were injected by the state into its capital, Deputy Governor of the NBU Oleg Churiy has said, when describing a possible scenario.

"We can fantasize what could happen if the court of appeals makes a negative decision ... PrivatBank's capital is UAH 147 billion. If to take away UAH 155 billion, we will have a huge hole in capital, more precisely, in assets. And the National Bank will again declare the bank insolvent," he stated at the Swedish-Ukrainian business forum in Kyiv.

Churiy said that in this case the bank would be transferred to the Individuals' Deposit Guarantee Fund, which will ask the government for government domestic loan bonds to pay the guaranteed amount of compensation to depositors, while the fund, in turn, will come to the National Bank for their monetization.

"We will have an impact on the foreign exchange market and on inflation," the deputy head said.

He noted that the National Bank has no right to comment on court decisions, but the events taking place bear risks to the market.

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