(KYIV, UKRAINE) – The Deposit Guarantee Fund of Ukraine has transferred more than UAH 46 billion to the state budget. At the same time, the state has missed out on over UAH 1.7 billion because of actions taken by former owners of Ukrinbank, a commercial lender now in liquidation. The UAH 46 billion paid into the budget equals USD 1.12 billion, GBP 874 million and EUR 1.02 billion. The UAH 1.7 billion the state has not received equates to USD 41.3 million, GBP 32.3 million and EUR 37.8 million.
The fund said banks under its management have directed UAH 1.3 billion to the State Tax Service since the start of Russia’s full scale invasion. Those payments covered tax debts owed to the tax authority, which ranks as a seventh and eighth tier creditor. That sum equals USD 31.6 million, GBP 24.7 million and EUR 28.9 million.
A further UAH 13.3 billion was used to settle state borrowings linked to the systemic banking crisis of 2014 to 2017. The fund stated that this sum would have been larger by more than UAH 1.7 billion had it not been for moves by the previous owners of Ukrinbank. The legality of those actions is now being challenged in court by the fund. The UAH 13.3 billion sent to settle borrowings equals USD 323 million, GBP 253 million and EUR 296 million.
The previous owners have for years blocked the lender’s liquidation procedure and stripped it of all assets, the fund said. Those actions have prevented settlements with creditors under the process laid out in Ukraine’s law on the household deposit guarantee system.
After the fund placed Ukrinbank under temporary administration and paid its depositors UAH 1.8 billion, the former owners altered the entry in the unified state register of legal entities and individual entrepreneurs. The legal entity Public Joint Stock Company Ukrinbank, registered in Kyiv, was re-registered as Public Joint Stock Company Ukrinkom, a non-banking legal entity, at a new address in Sievierodonetsk, a city now under Russian occupation. The UAH 1.8 billion paid to depositors equals USD 43.7 million, GBP 34.2 million and EUR 40 million.
Following the re-registration, Ukrinbank’s assets were moved under the control of Ukrinkom. That move halted all settlements with the bank’s creditors. Ukrinkom has since entered a controlled bankruptcy process as a non-banking institution. The fund said that such a process does not protect the bank’s creditors and effectively prevents the fund from recovering money for the state.
Separately, the fund has transferred to the state budget assets and funds equal to UAH 28.8 billion that belonged to the Ukrainian subsidiaries of Russian state banks MR Bank and Prominvestbank. Those transfers have occurred since the start of the full scale war. That sum equals USD 699 million, GBP 547 million and EUR 641 million. An additional UAH 3.3 billion was paid to the state in its role as a ninth tier creditor of MR Bank, formerly known as Sberbank, while the lender is under the fund’s management. That payment equals USD 80.1 million, GBP 62.7 million and EUR 73.4 million.
The Deposit Guarantee Fund is insisting on its participation in a Supreme Court hearing concerning the alleged improper removal of Ukrinbank from state supervision.