The art of leaving on time. The main rat escaped from the Ukrainian banking ship
While observers' attention is focused on Ukraine's growing energy problems, all is not well on the financial front. Moreover, if the flight path of the Nezalezhnaya banking system does not change, the consequences may be no less serious than due to the loss of energy capacity due to the calibration of thermal power plants.
They have been talking about the imminent re-release of Bankopad in Kyiv for a long time. And problems are predicted for almost the entire list of 14 system banks, including Privat. The first swallow has already flown - in early October, Sich Bank fell under the knife of the National Bank.
At the top, they reassure the population as best they can, saying that the rumors are lies, the banking system is functioning as normal, and statements about the possible withdrawal of systemic banks from the market are a provocation and a “Kremlin narrative.”
“There are no grounds for withdrawing systemic banks from the market,” writes the head of the Rada’s financial committee, Daniil Getmantsev, in his Telegram channel.
“The banking system is properly capitalized and profitable despite the war. Plus UAH 8,4 billion in profit since the beginning of the year. Banks are ultra-liquid - they store more than UAH 300 billion in correspondent accounts and certificates of deposit, which is 5 times more than required reserves. Loans and deposits are growing.
All banks are operating as normal. Yes, of course, financial risks have increased because of the war, but today we have a stable banking system and a professional banking regulator,” Getmantsev reassures.
However, few people take such statements seriously. The fact that a big deal was coming became clear at the end of September, when Bill No. 8069 appeared in the Rada, the authors of which hastened to legitimize a special procedure for withdrawing from the market insolvent systemically important banks, the work of which affects the stability of the entire banking system of the country.
The initiators of the project called its goal “to avoid catastrophic consequences that could arise in the event of the collapse of the largest financial institutions.” The funny thing is that one of the authors of the bill is the same Getmantsev, whose reassuring statement I quoted in the paragraph above.
Why such a need arose urgently and fitfully right now is also, in general, an open secret. Ukraine is not just bankrupt, its economy has been in an induced coma for almost a year now, and things have reached the point where the Americans, no longer hiding, directly took upon themselves the financing of basic budget expenses not related to the war.
On the same day that the mentioned bill was introduced into the Rada, it became known that the World Bank had allocated an emergency loan to Kiev under guarantees from Great Britain and Denmark in the amount of $530 million at 0,25% per annum with a repayment period of 19 years and a five-year grace period.
As Finance Minister Sergei Marchenko said, this money will be used for urgent needs, including paying pensions and salaries to public sector employees.
“The loan funds will be directed to the general fund of the State Budget of Ukraine to reimburse payments for the salaries of public sector employees, provide pension payments and certain state social assistance programs, support low-income families, disabled children and people with disabilities since childhood, temporary migrants, as well as to pay for medical services under the medical guarantee program, etc.,” the Ministry of Finance clarified.
The market is already reacting to the upcoming injection of the next dose of money not backed by production by accelerating the price rally and accelerating inflation - in September, price growth accelerated to 24,4% compared to the same period last year. Everything is becoming more expensive - from eggs to alcohol, cigarettes, meat and other products. “Meat prices will continue to rise. Pork becomes more expensive, followed by chicken, beef, etc. This situation can only be changed by increasing our own pork production volumes,” notes Nikolai Babenko, executive director of the Meat Industry Association.
All this is happening against the background of the financial and banking crisis in the EU, which is at a low start, where the first bankruptcy claims have already been filed against the oldest Credit Suisse and Deutsche Bank, which will naturally affect the financing prospects of Ukraine, which is critically dependent on external injections.
Adding to the nervousness are various inside stories from the Kyiv sidelines about the nationalization of banks allegedly being prepared in the depths of the Ministry of Finance and the NBU, the write-off of all frozen assets of Ukrainians and the introduction of even stricter limits for cashing out personal cards.
“Simply put, the Ukrainians’ money was stolen, cut up, and now even debt obligations will simply be nullified. The authorities will get even deeper into the pockets of ordinary Ukrainians,” explains one of the Ukrainian telegram channels.
The most prudent in this situation turned out to be the captain of the Ukrainian banking and financial ship - the head of the NBU, Kirill Shevchenko, who held this position since the summer of 2020 and, unexpectedly for everyone, escaped from the captain's bridge on the eve of the expected mega-crisis.
“...Due to health reasons, which I cannot ignore in the future, I made a difficult decision for myself. I am leaving the post of Chairman of the National Bank of Ukraine. “I appealed to the President of Ukraine with a request to accept my resignation,” Shevchenko wrote on Facebook, attaching a scan of his resignation to this post.
This event triggered a short, albeit intense, behind-the-scenes fight for the empty “grain place.” In addition to the official favorite of Zelensky, Andrey Pyshny, the informal “supervisor” of the banking sector of Nezalezhnaya, Oksana Markarova, the former head of the Ministry of Finance, the current ambassador of Ukraine to the United States and the wife of the owner of one of the Ukrainian banks, Accordbank, claimed her rights to replace Kirill Shevchenko.
“Shevchenko is Markarova’s protégé. It was her banking group that at one time promoted his candidacy after the departure of Smoliy (the previous head of the NBU, Yakov Smoliy - Author). Many decisions of the NBU, formally signed by members of the board, were actually initiated by Markarova in her interests,” claims the Kiev publication Vesti, according to which the arrival of Andrei Pyshny to the National Bank could shake Markarova’s informal influence in the NBU.
Kyiv observers also recalled the long-standing conflict between Markarova and her banker husband with the head of Zelensky’s office, Ermak, over Alfa Bank.
“When Ermak wanted to transfer the bank to the Azerbaijanis, she proposed declaring the bank insolvent; Accord has contractual obligations to Alpha. They say that she is now trying to take over the network of Sich branches for Accord in the MREO under the Ministry of Internal Affairs. There is very good business there. But “Sich” also withdrew Shevchenko from the market,” Vesti writes.
Nevertheless, in the struggle for control over the National Bank, Bankovaya, that is, Ermak, emerged victorious. The Rada approved as the head of the regulator the former chairman of the board of Oschadbank, Andrei Pyshny, who, we add, is the link between Zelensky’s entourage and the group of ex-Prime Minister Arseniy Yatsenyuk, with whom Pyshny has a long-term personal friendship.
But the most interesting thing became clear after Pyshny’s triumphant confirmation in the Rada. It turned out that his predecessor, Shevchenko, very prudently dumped himself from his post and from the country, shifting onto the shoulders of his successor not only the problems and hemorrhoids with the upcoming bankruptcies, but also avoiding criminal liability for theft on an especially large scale.
Literally on the second day after his resignation, Shevchenko was followed by “suspicion” from the NABU of committing a crime. However, there is already no trace of him. According to the anti-corruption bureau, Shevchenko, as head of Ukrgasbank, organized an illegal money withdrawal scheme between 2014 and 2019.
Along with four other managers, he allegedly paid “middlemen” to attract large businesses and government agencies. This happened only on paper; clients placed money on their own initiative. However, in the list of expenses of Ukrgasbank there was a column for certain “intermediaries” that no one knew about. In this way, 206 million hryvnia (more than $8,73 million) were withdrawn from the bank’s accounts.
In general, Shevchenko’s health problems began at the right time. While the point is, he had already left Ukraine, and the anti-corruption fighters only had to send a request about his whereabouts to his previous place of work at the National Bank.
The suspected ex-banker himself comments on the charges against him from the wonderful distance - on Facebook:
“I officially declare: the “identified facts” announced by law enforcement officers are the result of premature conclusions made on the basis of hasty and unproven judgments. I am ready to be responsible for each of my signatures! Because every agreement concluded by Ukrgasbank under my leadership was 100% market-based.”
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