The government’s reform strategy for the public banking sector provide the possibility of full privatization of the backbone of Oschadbank and Ukreximbank long-term solution relative to the volume of shares for sale and the timing of such a sale will be made by the Cabinet of Ministers no later than the end of 2020.
This is stated in the government approved «the strategic Foundations of reforming the state Bank sector».
According to the document, the text of which was published by the Ministry of Finance on its official website on Tuesday, 16 February 2016, the medium term (to mid-2018) entails the sale of at least 20% stake in Oschadbank and Ukreximbank qualified investor or international financial institutions (IFIs) by holding transparent competition.
«For this Supervisory boards of systemically important banks in 2018 will have priority to choose the method of sale of shares and to agree it with the Ministry of Finance. The final decision on the sale of shares should be made by the Cabinet of Ministers not later than the first quarter of 2018», – stated in the document.
As noted in the document, the government is interested in attracting IFIs (IFC, EBRD, the German company for investment and development) as partial owners or investors in subordinated debt.
According to the strategy, the ultimate goal of government ownership of banks indicated higher income and investment management with positions of increasing their value.
To do this, in the short term, it envisages a fundamental change in corporate governance, changes in business and operating models of banks.
Sistemoobrazujushchih banks relative to the document stated that the purpose of the state is out of the capital through privatization or liquidation within the time specified for each Bank separately.
According to the strategy, before 2020 the Bank must be in the TOP-5 banks lending the retail business and in the TOP 3 on lending and deposits to micro, small and medium business «Ukreximbank» – start service retail and micro business.
The state will decide on the terms and conditions of gradual addition of Oschadbank to guarantee Fund of individuals ‘ deposits as of 2017 on the basis of economic analysis of the implications and risks for banks and the banking sector, and will also consider the economic feasibility of the formation of export promotion center and the establishment of operational interaction between «Ukreksimbank» and the Agency for insurance of export risks in the event of its creation.
According to the document, the state has wholly or partly out of capital «Ukrgasbank» by the end of 2017.
The UGB needs to prepare a strategy of development focused on sale of the state share in capital of the Bank up to April of the current year and transfer it to the Ministry of Finance. The state also plans to get out of the capital «Rodovid Bank» and other banks in 2016.
According to the data given in the document, at present the share of assets of state-owned banks on the banking market of Ukraine is about 26%.
As of the end of the third quarter of 2015, the credit portfolio of banks with regard to reserves amounted to 231 billion USD, and was formed mainly at the expense of corporate loans.
As reported, Finance Minister Natalia Jaresko at the meeting of the government on 12 February presented a strategy for reforming the state Bank sector.
On 15 February, the Deputy Minister of Finance of Ukraine Artem Shevalev said that the total yield of the capital of the largest state banks — «Oschadbank» and «Ukreximbank», — is planned by the Ministry since the middle of 2018, and the remaining banks by the end of 2017.
As expect in the Ministry of Finance, in the near future the document will be sent to the Verkhovna Rada.
«Oschadbank» and «Ukreximbank» will sell by the end of 2020 17.02.2016