NBU to appeal court decision on Kolomoisky's surety agreement
The National Bank of Ukraine (NBU) will appeal the court decision on the termination of Ihor Kolomoisky's surety agreement.
"The National Bank of Ukraine is indignant over the judgement of the Pechersk District Court of Kyiv from April 20 to terminate the agreement of Ihor Kolomoisky's surety for refinancing loans obtained by PrivatBank before the government has entered the bank's capital," the NBU wrote on Facebook.
It is reported in 2015, Ihor Kolomoisky, one of the bank's owners at the time, entered into personal surety agreements with the National Bank of Ukraine for the repayment of five refinancing loans granted to PrivatBank in the period from 2008 to 2014.
"In doing so, he undertook personal liability for the repayment of the bank's debts to the NBU currently amounting to UAH 9.2 billion," reads the report.
"Ihor Kolomoisky has demonstrated his unwillingness to fulfil his undertaken obligations voluntarily despite the grave consequences the state of Ukraine would be forced to face as a result of his actions. In September 2017, to avoid his joint and several obligations, he took legal action seeking to terminate the surety agreements. Today's court decision has not yet come into legal force and will, certainly, be appealed against," reported Viktor Hryhorchuk, Head of the NBU's Claims Office at the Legal Department.
The National Bank is concerned with the outcomes of trials in the courts of the first instance, as this is already the third decision not in favour of the state in the last three days.
"This yet another court decision creates legal uncertainty and, consequently, potential risks for the future financial stability of Ukraine. This decision also makes it more difficult to protect the state interests in legal proceedings for the compensation of damages inflicted by former owners of PrivatBank to the bank itself and the state that are pending in other jurisdictions," added Hryhorchuk.
"It should be reminded that in 2018, the National Bank of Ukraine filed four actions to Ukrainian courts and one action to the Court of First Instance in Geneva, Switzerland, seeking the repayment of PrivatBank's refinancing loans by Ihor Kolomoisky. On March 19, 2019, the Supreme Court of Ukraine sustained the NBU's cassation appeals and obliged the Dnipropetrovsk Oblast Commercial Court to adjudicate the said claims. The NBU will continue to take the legal remedy as necessary to secure the repayment of these funds by Ihor Kolomoisky," the NBU added.
As UNIAN reported earlier, the Cabinet of Ministers in December 2016 decided to nationalize PrivatBank, guided by the recommendations of the National Security and Defense Council. Before nationalization, the key shareholders of the bank were businessman Ihor Kolomoisky and his partner Gennadiy Bogolyubov.
On April 18, 2019, the Kyiv District Administrative Court declared unlawful and overturned the decision of 2016 to withdraw the "insolvent" PrivatBank from the market with the participation of the state. The full text of the decision will be announced by the college of judges within 10 days.
According to a joint statement by the National Bank, the Ministry of Finance and PrivatBank, the return of the financial institution to its former owners through the cancellation of the nationalization decision is impossible. Also, the NBU reported its intentions to appeal the ruling within the prescribed time frame, or within 30 days from the receipt of the full text.
Chairman of the bank board, Peter Krumhansl, assured that the first instance court ruling rolling back nationalization would not affect the bank's work. According to him, the bank is operating as usual, its liquidity today is almost 100% and there are no emergency situations recorded, including massive withdrawals of money from the accounts, and limits on such operations.
Ukraine's international partners, in particular the European Bank for Reconstruction and Development, the World Bank and the U.S. Embassy made statements on support for the nationalization of PrivatBank, as well as on the importance of indemnifying the losses by the former owners of bankrupt banks, and on intentions to closely monitor developments in this area.