Ex Privatbank owners gain interim success in questioning its nationalization

2018/4/11 22:27:00

Analyst: “So far, it is hard to predict who will win the legal battle around Privatbank, but it is clear that the battle will take many years.”


 

 

 

 

 

 

 

 

 

 

 

 

KYIV, Apr 11, 2018 - Kyiv Administrative Court ruled on March 2 to recognize as unlawful an order of Ukraine’s central bank (NBU) of October 2016 to initiate an inspection in Privatbank (PRBANK), Concorde Capital informed clients based a finclub.net news site report on April 10 citing its sources in the central bank. The NBU has already filed an appeal against the ruling which is not publicly available. A Cyprian company Triantal Investments, which is a former shareholder of Privatbank, was an initiator of the court hearing.

 

According to finclub.net, the NBU’s decision to declare Privatbank insolvent in December 2016 was based on the results of the October 2016 inspection. Therefore, by questioning the validity of the inspection, the former shareholders of Privatbank are trying to undermine the legal ground behind the validity of the bank’s insolvency recognition.

 

Recall, Privatbank was declared insolvent and nationalized in December 2016. Since then, the government contributed UAH 155.3 mln (USD 5.9 bln) into the bank’s equity, and bailed-in creditors of the bank contributed USD 1.1 bln into its bailout. The government and Privatbank are suing former shareholders (Igor Kolomoisky and Gennadiy Bogoliubov) in London, demanding compensation of over USD 2 bln.

 

Concorde analyst Alexander Paraschiy added: “Aiming at avoiding responsibility for the insolvency of Privatbank and related claims for compensation from the state, Kolomoisky and Bogoliubov will use any procedural breaches in the complicated process of Privatbank's nationalization to question the validity of the entire process. So far, it is hard to predict who will win the legal battle around Privatbank, but it is clear that the battle will take many years. For the bailed-in holders of Privatbank Eurobonds, the latest news looks encouraging, but one should take into account that this was a ruling of the court of first instance.”

 

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For more information, link here: www.concorde.ua

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