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Courts Reaffirm Legality of 15 NBU Decisions Regarding Banks Withdrawn From Markets

12 January 2018

Press Release


Courts have on many occasions confirmed the legality of NBU’s decisions regarding insolvent banks. There were 15 such court decisions in total.


Also, some 26 cases initiated by shareholders or depositors of insolvent banks to appeal the NBU’s decisions on withdrawing them from the market are being heard by first instance courts and courts of appeal.


At this, courts awarded 11 rulings that had repealed NBU’s decisions on declaring banks as insolvent ones and/or revoking a banking license, as well as starting bank liquidation. They pertained to such banks as Soyuz bank, Zlatobank, Ukrinbank, Veles Bank, Radical Bank, Bank Financial Initiative, Bank Kyivska Rus, SCG Bank, Khreschatyk, TK Credit, East-Industrial Commercial Bank.


The NBU believes that the courts’ rulings ordering to reinstate these insolvent banks pose a systemic risk to the financial stability of the country. Since court decisions of the kind have created a precedent when the judicial system is being abused by owners of the banks that have been withdrawn as a quasi-legitimate tool to return those banks to the market. In its turn, it undermines the NBU efforts which aim to clean up the domestic banking system.



For reference


The procedure for incorporation of a legal entity seeking to carry out banking activity, the regulation of such activity and bank liquidation is specified by laws and regulations of Ukraine. Along with that, the law does not provide for a mechanism for restoring bank’s activity, including through court decision, after the banking license has been revoked and the bank liquidated.

Last modification   12.01.2018