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Ukrainian Cabinet Submits IMF-Required Bill On Banks To Parliament


Ihor Kolomoyskiy
Ihor Kolomoyskiy

Ukraine's cabinet has submitted to parliament a revised bill on banking regulations needed to meet requirements set by the International Monetary Fund (IMF) for a new lending package as the country's feeble economy braces for the effects of the coronavirus outbreak.

The bill appeared on the Verkhovna Rada's website on March 24 and was agreed by the central bank and Finance Ministry.

Its aim is to protect the country's interests following a decision to nationalize insolvent or troubled banks and prevent tycoons from regaining control over their former assets.

An extraordinary parliamentary session to review the bill, as well as other measures to cope with the coronavirus pandemic, has been pushed back from March 26 to March 28 after a fourth lawmaker tested positive for COVID-19.

While the bill could have broad implications in Ukraine, it is widely known that its main purpose is to prevent Ihor Kolomoyskiy, the former co-owner of PrivatBank, from regaining ownership rights to the bank.

Most of the 103 banks that were either nationalized or had their licenses revoked in 2014-2016 were found to have been engaged in widespread third-party lending.

U.S.-based corporate investigative firm Kroll and attorneys at AlixPartners had found a hole of at least $5.5 billion in PrivatBank's balance sheet.

Kolomoyskiy has denied wrongdoing and maintains he is the rightful owner of PrivatBank.

Ukraine has been in talks with the IMF for months about a three-year, $5.5 billion loan tied to reforms to help the country meet a spike in debt repayments this year.

Ukraine is reportedly seeking to borrow even more money internationally as it increases spending to fight the spread of the coronavirus and support companies and individuals negatively affected by the potential economic fallout.

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