By KYIV. May 4 (Interfax-Ukraine) – The absence of votes on May 2 for the adoption of the bill (No. 9107-1) on the withdrawal from the market or the nationalization of banks whose shareholders fell under sanctions is due to the imperfection of its norms, which is planned to be eliminated during the bill’s finalization, Head of the Servant of the People parliamentary faction David Arakhamia has said.
“No one is completely against taking Alfa, PIN and Motor-Bank. The hall is embarrassed by the future of other norms. According to the bill, if sanctions are imposed by the National Security and Defense Council even on a minority Ukrainian shareholder, the bank is immediately withdrawn from the market. Strange norm, don’t you think?” he wrote in the comments to the post of adviser to the head of the Office of the President Viktoria Strakhova.
Arakhamia, who himself backed the law, said that he shaped an opinion about the imperfection of the bill after talking with those who did not vote.
“It is proposed to repeat the path, as well as on special confiscation: a lawsuit – a decision of the HACC [High Anti-Corruption Court] – confiscation of a stake belonged to the problem shareholder,” he said, pointing out the way to finalize the bill.
“For non-systemic banks, this decision is quite reasonable. I am sure that we will come to it at the second reading,” the head of the Servant of the People faction added.
According to him, it is wrong to blame the Rada for the fact that the bill was sent for a repeated second reading the day before, since decisions need to be prepared more elaborate.
“To finalize it at the committee, the consent of the customer (the NBU) to this compromise was needed – there was none. I warned that it would hardly be possible to push through, a compromise had to be found,” Arakhamia said.
With regard to Alfa-Bank (now renamed Sense Bank), he recalled that “at night, urgently five months ago, we already adopted one law” on the nationalization of Alfa, and “somehow it did not work out later.”
As reported, bill No. 9107-1 was supported at the second reading on May 2 by 212 MPs with the required minimum of 226 votes, although 274 MPs backed it at the first reading. As a result, by 264 votes it was sent for a repeated second reading.
The document authorizes the National Bank to prohibit a sanctioned person from acquiring or increasing a substantial stake in a bank, to revoke a banking license and liquidate a bank if it is not systemically important, or nationalize it under a simplified procedure without additional capitalization if the bank is systemically important.
The possibility of withdrawing a systemically important bank from the market (nationalization) is introduced if it does not show signs of insolvency (when blocking sanctions are applied to the bank or the holder of a substantial stake in it).
In addition, a norm is fixed, which provides for the possibility of compensating persons for the damage they suffered as a result of the liquidation of a bank or its nationalization, exclusively at the expense of the aggressor state.
As head of the relevant parliamentary committee Danylo Hetmantsev said earlier, the bill concerns Sense Bank (formerly Alfa Bank) since the sanctioned Russians Andrey Kosogov, Mikhail Fridman, and Petr Aven own its controlled stake, although the structure of shareholders indirectly includes the Italian Unicredit s.p.a. and The Mark Foundation for Cancer Research.
At the beginning of March this year, the bank with assets of UAH 96.88 billion ranked ninth among all 65 banks operating in Ukraine.
This document would also affect the sanctioned co-owner of Motor Bank Viacheslav Bohuslayev, who was banned by the National Bank in November from voting rights for 100% of the bank’s shares. At the beginning of March, Motor-Bank ranked 21st among 65 Ukrainian banks in terms of total assets with UAH 1.64 billion, while at the beginning of September, with assets of UAH 2.27 billion, it was 45th among 67 Ukrainian banks.
Another bank, in which 88.890583% belonged to the sanctioned Russian Evgeny Giner –PINbank – has already been de facto nationalized after the HACC Appeals Chamber confirmed the decision to turn this stake into state income.
PINbank became the fifth bank controlled by the state. Under the recently approved Extended Fund Facility (EFF), given the heightened risks of further nationalization of banks, the Ukrainian authorities are committed to making decisions consistent with the overall strategy to reduce state ownership in the banking sector.
Earlier in 2022, the Rada already adopted a law on a simplified procedure for the nationalization of systemically important banks, which allows it to be carried out without additional capitalization from the state; the only condition for nationalization was the illiquidity of a financial institution. A number of MPs and experts argued that this law would be applied to Sense Bank, but at present, its financial indicators do not give grounds for this.
In turn, the bank, at the request of the agency to comment on the new bill, previously reported that they were aware of such an initiative and called it one of the possible scenarios for the development of events. However, they continued work on finding investors and capitalizing the bank with private money by $1 billion.
“We are ready for any scenario: to remain a private bank or become a state-owned one,” the bank said.
In addition, on March 3, Sense Bank announced the signing of a memorandum with potential investors from Poland who are interested in entering the Ukrainian market and sending their letters to the leadership of the NBU and the deputy head of the President’s Office. According to the agency, it was about the Grupa Polsat Plus corporation of one of the richest people in Poland, Zygmunt Solorz-Żak.
The NBU confirmed the receipt of a letter from a potential investor and announced that it had provided a “comprehensive answer on the merits,” and also said that to agree on a substantial participation, it is necessary to submit a full package of documents, defined by the law on banks and regulatory legal acts of the National Bank.
In addition, the regulator said that, given the EU Council sanctions imposed on Fridman and Aven, as well as the NSDC sanctions against Fridman, Aven and Kosogov, all these persons are deprived of the right to dispose of their own assets and alienate them in any way until the sanctions are lifted.
