The National Bank of Ukraine has set out the procedure for reorganization of banks and the rules governing the termination of banking activities without the dissolution of a legal entity in accordance with the Law of Ukraine On Simplified Recapitalization and Restructuring Procedures for Banks.
Amendments to this effect are intended to shorten the review process for documents submitted to the NBU and streamline recapitalization procedures covered by the Regulation on the Procedure for the registration and licensing of banks and opening separate units. In particular:
- a bank is allowed to implement the recapitalization under the simplified procedure subject to a prior approval of the NBU
- The NBU to make a decision on whether to approve or reject the request for approval within 10 business days after the day the regulator receives documents from the bank
- the resolution has set out an approval procedure for amendments to the bank charter related to an increase of the authorized capital of the bank under the simplified procedure and
- the regulator has streamlined approval procedures for the acquisition or increase of the qualifying holding in a bank under the simplified recapitalization and restructuring procedures.
This resolution also sets out the rules governing the termination of banking activities without the dissolution of a legal entity. This move will enable banks that will fail to meet the meet the recapitalization requirements set by the NBU to withdraw from the banking market without increasing the financial burden on the Deposit Guarantee Fund.
The amendments to this effect are introduced by NBU Board Resolution No. 56 of 16 June 2017 On Amendments to Some NBU Regulations, which shall come into effect from 20 June 2017.
On 8 June 2017, the NBU issued NBU Board Resolution No. 48 whereby a simplified bank reorganization procedure was put in place.