Ministry of Finance Statement on the situation with bank "Kyiv" assets

6/9/15

The Ministry of Finance of Ukraine is deeply disappointed that depositors are unable to access their funds as a result of actions in the courts and the unexpected and unacceptable claims towards the assets of “Kyiv Bank”.

The Ministry is actively continuing its work to strengthen the financial solvency and improve the corporate governance of state-owned banks. As a matter of urgency, the Ministry of Finance is taking measures to address the problem of depositors’ access to their deposits in Kyiv Bank. Furthermore, with the assistance of the Ministry of Finance, the Cabinet of Ministers of Ukraine adopted a decision on a special procedure for the Kyiv Bank in February 2015, which will allow the bank to withdraw from the market while also ensuring the transfer of depositor’s funds into another state-owned bank, UkrGazBank. Through this special procedure, the owners of the deposits, including both physical and legal entities, will have full access to their accounts after the transfer of Kyiv Bank’s deposits to UkrGazBank. This will also extend beyond the UAH 200,000 already guaranteed through pre-existing insurance. As of January 1st 2015, the “Kyiv Bank” has 22,717 investors/physical entities, with deposits greater than UAH 10.

However, the process of asset transfer from Kyiv Bank to UkrGazBank has been halted due to the unexpected and unacceptable court actions and claims to Kyiv Bank assets. Owners of small deposits (EUR 280) in Kyiv Bank have attempted to use the legal system to prevent other depositors from accessing their funds. As a result of these claims, Kyiv Bank’s deposits have been frozen, bringing the asset transfer process to a halt. It should also be noted that the court has imposed a freeze on any transfer of Kyiv Bank’s deposits including the return of the remaining depositors’ funds.

The Ministry of Finance of Ukraine stands ready to complete the transfer of funds in order to provide depositors of Kyiv Bank with access to their money after many months of delays. We wish to assure depositors that we will continue to fight for a swift conclusion to this problematic transfer process, which is part of an important process for the country by ensuring adherence and fulfillment of the rights of citizens of Ukraine.

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