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National Bank of Ukraine Comments on the Supreme Court Decision on Zlatobank

14 February 2019

Press Release

 

The National Bank of Ukraine (NBU) is deeply concerned with the decision of the Supreme Court as of 5 February 2019 that found illegitimate the regulator’s decision as of 13 February 2015 on classifying Zlatobank PJSC as insolvent.

 

In addition to overturning the decision of the regulator, the court compelled the NBU to grant Zlatobank the term – as set out in Article 75 part seven of the Law of Ukraine On Banks and Banking – assigned for financial rehabilitation after liquidation, beyond the expired term.

 

Please be reminded that the procedure for incorporation of a legal entity intending to engage in banking, regulation of such activity, and bank liquidation are set out by laws and regulations of Ukraine. At the same time, law does not provide for a mechanism for restoring, including by a court decision, after the regulator decided to revoke the banking license and liquidate the bank.

 

“The NBU is certain that overturning the decision on classifying a bank as insolvent will by no means restore either its solvency or customer trust. Despite the liquidation procedure prescribed by law, the court gives rise to legal uncertainty annihilating operation of law. This, in its turn, infringes the rights of depositors and creditors that will be deprived of their funds as prescribed by the bank’s liquidation procedure,” argued Viktor Hryhorchuk, Head of the Litigation Office of the NBU Legal Department.

 

Taking into account Article 19 of the Constitution of Ukraine and the principles of legal certainty and the rule of law, the NBU hopes that the Supreme Court will provide in its decision an exhaustive clarification regarding the legal means for implementing the court decision, the status of the liquidation procedure of the bank, etc.

 

The NBU awaits the complete text of the decision of the Grand Chamber of the Supreme Court and will consider filing a petition for clarification of the court decision, after examining it. However, considering the history of similar cases, the NBU has not received any clarifications from courts on such decisions.

 

For reference:

 

On 13 February 2015, the NBU Board approved Resolution No. 105 On Classifying Zlatobank Public Joint-Stock Company as Insolvent. According to the ruling of the Kyiv District Administrative Court dated 14 July 2017 and the ruling of the Kyiv Administrative Court of Appeal dated 25 October 2017, the NBU’s decision in question was overturned. 

 

 

 


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Last modification   14.02.2019