As part of the already launched resolution procedure in respect of VAB BANK PJSC, on March 19, 2015, the National Bank of Ukraine adopted a decision to revoke a banking license and wind up this bank.
Starting from April 2014, based on the findings revealed in the course of banking supervision over activities of VAB BANK PJSC, the National Bank of Ukraine has repeatedly drawn the attention of the bank's management and owners to the exposure of VAB BANK PJSC to potential risks.
In order to protect the interests of depositors and other creditors of the aforementioned bank, in October 2014, the National Bank of Ukraine adopted a decision to declare VAB BANK PJSC a problem bank. The National Bank of Ukraine set a timeframe for VAB BANK PJSC to take measures to bring its operations into compliance with applicable legal requirements.
As part of the established procedure, the National Bank of Ukraine held talks with the management team and owners of VAB BANK PJSC in an effort to find ways to improve the financial standing of the bank. VAB BANK PJSC submitted the resolution plan, under which the financial support would be provided by the bank's shareholders within a set timeframe. However, the proposals put forward by the bank's owners appeared to have fallen short of maintaining the bank's solvency.
Therefore, the shareholders of VAB BANK PJSC failed to provide relevant financial support to the bank, which led to further deterioration of VAB BANK PJSC's financials, violation of prudential ratios, and its inability to meet its obligations to depositors and other creditors on time. In particular, as of November 14, 2014, the amount of the bank's regulatory capital had fallen into negative territory – "minus" UAH 1,511 million (minimum regulatory capital requirement – no less than UAH 120 million).
In compliance with the requirements of Article 76 of the Law of Ukraine On Banks and Banking, and in view of the fact that VAB BANK PJSC's operations failed to comply with the requirements of banking laws and NBU regulations, the Board of the National Bank of Ukraine adopted a decision declaring VAB BANK PJSC insolvent (NBU Board Resolution No 733 dated November 20, 2014).
In compliance with Article 34 of the Ukrainian Law On Household Deposit Guarantee System, the Executive Directorate of the Household Deposit Guarantee Fund (the DGF), on the next business day after the bank was declared insolvent by the NBU, placed the bank under a provisional administration (for the period from 21.11.2014 to 20.02.2015), and appointed an authorized person to that effect. On 17.02.2015, the DGF Executive Directorate adopted a decision to prolong the provisional administration at VAB BANK PJSC till 20.03.2015.
Having considered the DGF proposal concerning liquidation of the insolvent bank, the National Bank of Ukraine has issued a resolution to revoke a banking license held by VAB BANK PJSC and wind up this bank.