Banks that are partly owned by Russia should be able to “calmly and without panic” withdraw from the Ukrainian market where they have no future, the Deputy Chairman of the National Bank of Ukraine (NBU), Katerina Rozhkova said in an interview with Minfin web site.
“There is no development for Russian banks here. This should be clear to everyone. On the other hand, as a regulator, we believe that the exit from the market should be civilized. No one should get bricked. Let the banks have the opportunity to leave the market quietly and without panic,” stressed Rozhkova.
According to her, the regulator has not yet received complete packages of documents from buyers of Sberbank's “daughters” or affiliated undertakings. Regulators plan to conduct all necessary inspections within three months.
The remaining banks that Russia is invested in include Prominvestbank, VTB, BM Bank and VS Bank. Ukrainian authorities have imposed sanctions on all of them. Rozhkova said that they already have potential buyers. “They do not cross passes. But we do not have official notifications from any of them. Perhaps in the process there will be something to change,” the Deputy Head explained.
She did not deny the possibility that Russian banks would be unable to find buyers for their Ukrainian affiliates. She said would have to simply pay out to customers and give back licenses. “The question is whether there will be enough liquid assets. This is normal for all Russians,” Rozhkova said.
The day before, on April 26, the head of VTB Bank, Andrey Kostin said that the Kiev first made it necessary for Russian banks to withdraw from Ukraine. Now it continues to hamstring the process of withdrawal from the market.
The First Deputy Chairman of the VTB, Vasily Titov told reporters on that same day that the bank already has proposals to buy its assets in Ukraine but so far they are “not satisfied” with VTB. Titov emphasized that VTB will undertake “no abrupt movements” to avoid harming the business and customers who trust the bank.
In Mid-March of 2017, Ukrainian authorities imposed sanctions on five Ukrainian banks invested with Russian state capital, namely Sberbank, VTB, BM Bank, Prominvestbank and VS Bank. They also included a ban on withdrawing funds abroad.
In late January, the head of the National Bank of Ukraine, Valeriya Gontaryeva said in an interview with Novoye Vremya that shares held by Russian banks in the Ukrainian market have declined from 15% to 8% in recent years. According to Gontaryeva, problems with banks with Russian capital appeared because they actively credit Donetsk and Lugansk regions.
Currently, there are seven banks with Russian capital that operate in Ukraine: two Sberbanks (Sberbank Ukraine and VS Bank), two VTB (VTB Bank and BM-Bank), Prominvestbank (controlled by Vnesheconombank), Alfa Bank (included in Alfa Group) and Forward Bank, of which Russian Standard Bank is an actioner.
These five banks have been reducing their assets for a year, according to IFRS financial statements for the third quarter of 2016. In particular, Sberbank, which is the fourth largest Ukrainian bank in terms of assets by Banker.ua’s estimation, has reduced assets by around 9%. This amounts to 47.2 billion hryvnias, down from 51.8 billion. Alfa Bank, which is in fifth place, has made a 2.8% reduction, from 42.4 billion to 41.2 billion hryvnias. BM-Bank reduced by 6.3%, from 3.2 billion to 3 billion hryvnias. VTB Bank reduced by 19.1%, from 25.7 billion to 20.6 billion hryvnias.
Earlier, the regulator noted that the share of individuals in banks with Russian capital declined from 9.3% in early 2014 to 5.5% by 2016. Shares of legal entities decreased from 8.3% to 3.3%.