Oschadbank loses appeal to claim 93% of Ukrtelecom shares

2018/6/19 22:56:07

Analyst: “As we highlighted before, the return of Ukrtelecom from the hands of Rinat Akhmetov, who controls ESU, to the state may have negative consequences for Ukrainian state banks Oschadbank and Ukreximbank (EXIMUK), which hold jointly over UAH 4.2 bln in ESU debt.”


KYIV, June 19, 2018.-. The Kyiv Appellate Economic Court rejected the appeal filed by Ukraine’s State Savings Bank (Oschadbank, OSCHAD) demanding foreclosure on 92.79% of the shares of Ukrtelecom (UTLM UK), Concorde Capital informed clients today based on a finbalance.com.ua news site report on June 18. The 92.79% stake was placed as collateral for UAH 2 bln in local bonds issued by ESU (the owner of the contested stake) and purchased by Oschadbank in 2013. In March 2017, when the bonds matured, Ukrtelecom and ESU failed to redeem them, which forced the bank to initiate the foreclosure.

 

In March 2018, the Kyiv Economic Court denied Oschadbank’s foreclosure request, referring to rulings of the same courts made in late 2017 that stipulated the return of the 92.79% Ukrtelecom stake from ESU to Ukraine’s State Property Fund. In this way, the collateral that Oschadbank is trying to recover does not belong to ESU anymore, but is property of the Ukrainian government.

 

Concorde analyst Alexander Paraschiy added: “As we highlighted before, the return of Ukrtelecom from the hands of Rinat Akhmetov, who controls ESU, to the state may have negative consequences for Ukrainian state banks Oschadbank and Ukreximbank (EXIMUK), which hold jointly over UAH 4.2 bln in ESU debt. With Ukrtelecom's return to state hands, we don't believe the banks will be able to recover the loans.

 

This won’t harm the banks’ liquidity much, as the loans are being rescheduled starting from April 2013, the date of their initial maturity. But this may be used by the banks as a reason to demand from the government another capital increase. In this way, these banks could benefit, but at the expense of the state budget.

 

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

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