A statement to this effect was made by First Deputy Governor of the National Bank of Ukraine Oleksandr Pysaruk at the meeting with CEOs of the largest banks.
"The National Bank has put a great deal of effort into disclosing information on the ultimate beneficial owners of banks. Presently, we hold regular meetings with the beneficial owners of banks on a daily basis, and sometimes several meetings per day. Sometimes the beneficial owners of banks turn out to be well-known people. Sometimes we know little about them. Going forward, the procedure for granting refinancing loans to banks is set to be absolutely transparent to the public," noted the First Deputy Governor of the National Bank of Ukraine when exchanging opinions with bankers on legislative initiatives adopted by the Verkhovna Rada of Ukraine in late December 2014.
The First Deputy Governor of the National Bank of Ukraine has placed special emphasis on the inappropriate "reporting" discipline of banks, which, according to him, undermines the ability of National Bank of Ukraine to provide an early response and perform the supervisory function in broad terms.
"One of the strategic tasks assigned to the National Bank of Ukraine is to impose tougher restrictions on insider lending practices of banks. These transactions, especially if carried out on a large scale, undermine the banking sector stability," said Oleksandr Pysaruk, adding that the regulator had drafted amendments to the laws, which would not only allow for identification of bank's related parties and but also reinforce management and shareholders' responsibility for carrying out transactions with related parties, misreporting and action or omission that ultimately had led to the bank's bankruptcy.
In addition, Oleksandr Pysaruk emphasized the issue of banks' meeting the terms and conditions of Memorandum on restructuring consumer loans in foreign currency (hereinafter – Memorandum) and suggested that banks consider the possibility of signing it. He also said that the National Bank had drafted an array of amendments to the laws regarding the taxation of transactions related to foreign currency loans conversion and tabled them to the Parliament for consideration. The above legislative initiatives together with abolishment of the Law of Ukraine On Moratorium on Foreclosure of Ukrainian Citizens' Property Provided as Collateral for Foreign Currency Loans are a second condition necessary for the fulfillment of provisions of Memorandum.
Viktor Novikov, Director of the NBU Legal Department, who also attended the meeting, informed the bankers about an array of legislative initiatives drafted by the National Bank of Ukraine and submitted to the Verkhovna Rada of Ukraine for consideration. These include draft laws governing the handling of mortgage loans and collateral by banks, disposal of movable property, the establishment of the Credit Register of the National Bank, streamlining the procedure for cessation of business operations for joint-stock companies in the event of their liquidation, and the protection of creditors' rights, etc. The National Bank of Ukraine's officials in close cooperation with exerts from the International Monetary Fund finalize the draft law aimed at strengthening the autonomy framework and the institutional capacity of the National Bank of Ukraine.