Deposit Guarantee Fund called Ukrinbank a “zombie bank”

Deposit Guarantee Fund called Ukrinbank a “zombie bank”

The Deposit Guarantee Fund called PJSC Ukrinbank, which bankers Volodymyr Klymenko and Volodymyr Stelmakh re-registered as Ukrinok before the introduction of the interim administration, the last "zombie bank".  According to the Federal Guarantee Fund, this is the last bank of its kind.

Recently, after lengthy litigation, they regained control over another so-called "zombie bank" - PJSC "KSG BANK". As of 15 May 2024, the information about PJSC "KSG BANK" as a legal entity in liquidation was restored in the Unified Register. On 7 June, a record was made of the liquidation of PJSC "KSG BANK" by the Fund’s authorised representative. Currently, the DGF is working on resuming payments of guaranteed compensation, reconciling the register of accepted creditors’ claims, and conducting an inventory of the bank’s assets (property).

In fact, since 2017, the institution has been in the status of a "zombie bank". After appealing in 2016 against the decisions of the Regulator to revoke the banking licence and the DGF to initiate the liquidation procedure, the bank’s shareholders carried out a number of illegal actions in 2017-18 related to the re-registration of the legal entity.

The Fund reports that the former owners of the bank made changes to the Unified State Register, renaming the bank to PJSC KCG, changed the location of the legal entity, and then liquidated it altogether by setting up a "legal successor". In this way, they blocked the liquidation procedure. The Fund was forced to suspend payments to the bank’s depositors and creditors.

"In order to make ’zombie banks’ a thing of the past, we have to remove the last financial institution whose shareholders are holding creditors hostage, PJSC Ukrinbank, from the ’grey zone’," explained Viktor Novikov, Deputy Managing Director of the Deposit Guarantee Fund.

PJSC Ukrinbank stated that this is not true. We would like to inform you that on 24 February 2021. the Supreme Court of Ukraine declared the liquidation of PJSC Ukrinbank illegal.

By its ruling in case No. 826/5325/16, the Supreme Court composed of the panel of judges of the Administrative Court of Cassation dismissed the application of the National Bank of Ukraine to review the decision of the Higher Administrative Court of Ukraine dated 23 November 2016 in case No. 826/5325/16.

Thus, the Supreme Court finally ruled that the liquidation of PJSC Ukrinbank was initiated by the NBU and the Deposit Guarantee Fund illegally. This ruling of the Supreme Court is final and not subject to appeal.

As of today, there is no company called Ukrinbank. It is called Ukrinkom. The renaming of PJSC Ukrinbank to PJSC Ukrincom was carried out in accordance with the laws and procedures. The reason for the name change was the revocation of the company’s banking licence. Therefore, having the word "bank" in the name means misleading customers and the community.

The USREOU of PJSC Ukrinkom is exactly the same as that of PJSC Ukrinbank. The beneficial owners and management of the company have not changed. We have added a few new people. Jim Slattery (six-time US congressman) and Michael Kostiv (former advisor to the head of the CIA) became advisors to the chairman of the supervisory board.