Ukraine's largest lender, PrivatBank, should not be returned to its former owners in any scenario, according to a statement on the presidential website.
"There is no reason to return state-owned PrivatBank to its former shareholders" regardless of court rulings on the lender, said the October 23 statement released following a meeting between presidential office head Andriy Bohdan and ambassadors of the Group of Seven countries in Kyiv.
The fate of the financial institution, once owned by billionaires Ihor Kolomoyskiy and Hennadiy Boholyubov, has become a single-indicator test for President Volodymyr Zelenskiy, who has promised to eradicate graft and release the grip that influential oligarchs have on Ukraine's economy and political decision making.
Ukraine's international lenders, foreign investors, and corruption watchdogs are also closely monitoring the bank's plight as Kolomoyskiy, a former business associate of the president, has vowed to regain ownership rights to it.
He lost control in 2016 when the central bank nationalized it for not passing stress tests or having enough capital, and two years later an independent audit concluded that PrivatBank had conducted "large-scale and coordinated fraud" for at least 10 years leading up to its takeover.
U.S.-based corporate investigative firm Kroll and attorneys at AlixPartners also found a hole of at least $5.5 billion on the bank's balance sheet.
Kolomoyskiy has denied wrongdoing and maintains he is the rightful owner of the bank.
Speaking to Ukrainian Praymiy TV on October 19, Valeria Hontareva, the former central-bank chairwoman who took part in nationalizing PrivatBank, called Kolomoyskiy's efforts to receive monetary compensation for losing the bank "the theater of the absurd."
Speaking in London, Hontareva said the bank had about $6 billion worth of nonperforming loans that were made to Kolomoyskiy and related parties. "The bank was an empty pyramid [scheme]," she said.
Yet, as recently as October 22, a court in Kyiv gave the State Bureau of Investigations (DBR) access to documents related to cooperation between PrivatBank, the central bank, and the Finance Ministry with Kroll, as well as law firms Hogan Lovells, AlixPartners, and Asters.
The DBR will have access to information that could potentially blunt Ukraine's legal efforts to recover money that was allegedly funneled out of the bank in numerous foreign jurisdictions and at home, where Kolomoyskiy has initiated litigation in hundreds of cases related to the financial institution.
Hogan Levells has successfully represented the state-run bank in London, where on October 15 it won an appeal to freeze $3 billion in assets belonging to PrivatBank's previous owners and pursue claims on the money.
The London Court of Appeal also ordered the bank's former owners to pay PrivatBank $14 million by November 12 to cover the costs of last year's hearing and the legal work leading up to the October 15 decision by the Court of Appeal, Ukraine Business News reported.
The defendants were furthermore denied permission to appeal and were told to file their defense by the end of November.
Then on October 17, an economic court in Kyiv said it had suspended a trial on whether the nationalization of the bank was lawful until another case in an administrative court reaches a denouement.
Ukraine ranks 64th out 190 countries as a destination for ease of doing business, a yearly World Bank report published on October 23 said. Last year, it ranked 71st.
Kyiv was credited for streamlining the process of obtaining construction permits, making it easier to get electricity, register property, accessing credit, and improving access to credit information, protecting minority investors, and easing trading across borders.