The Sixth Administrative Court of Appeals on April 3 upheld the Dec. 27 lower court decision to cancel the liquidation of the Khreshchatyk bank, which was declared insolvent in 2016.
The Deposit Guarantee Fund of Ukraine released a statement on April 3, saying that the court decision dismisses the complaints of the National Bank of Ukraine, the Deposit Guarantee Fund and depositors who hope to recover their assets.
The lawsuit was filed by the company UkrFinKom, court documents and media reports show. According to a National Bank of Ukraine document and a Ministry of Finance statement from 2016, UkrFinKom belonged to Andriy Ivanov, who was also a member of Kyiv Investment Group, along with businessman Vasyl Khmelnytsky.
UkrFinKom once held an over 37.4 percent stake in Khreshchatyk, though the Ministry of Finance stated in 2016 that the company reduced its stake to 32.4 percent. The transparency platform YouControl now lists Andriy Semenov instead of Ivanov as the ultimate beneficiary of UkrFinKom.
The Deposit Guarantee Fund stated that it will extend the authority of Marina Anatolievna Slavkina, who had been empowered to oversee the bank’s liquidation and asset recovery.
“This is not a final decision, we will fight for the assets of the bank, and return them to the creditors,” said Lyudmila Shapran, the fund’s spokeswoman, in a brief phone call. “We think that cassation will be in our favor.”
The bank lost its license in June 2016, after being declared insolvent on April 5 of the same year. At the time, the bank had been said to have 308,000 depositors, almost 99 percent of whom were expected to be fully reimbursed for their funds for up to Hr 200,000. Total recovery was estimated at Hr 2.8 billion.
The bank went insolvent after shareholders were reluctant to invest in its capitalization. The NBU had stress tested Khreshchatyk, saying in 2016 that it needed Hr 1.25 billion in recapitalization by June 2017.
In 2016, the NBU accused Khreshchatyk of having major problems and said it needed a radical change in its business model.
The bank failed to provide lending to individuals despite billing itself as a bank for Kyiv residents, according to the National Bank of Ukraine. Khreshchatyk allegedly credited the companies of its private shareholders under low rates, insufficient for cash flow.
Shortly before the bank was declared insolvent, the Deposit Guarantee Fund claimed that Hr 2.3 billion was withdrawn from the bank by companies that showed all the signs of being fictive.
