In 2014, Olexandr Shlapak was the Minister of finance. In an interview … an economist told about the possible ways to solve the problems of banks without liquidating them and damaging the country’s economy and how the ex-VAB bank owner tried to save his banks.
So, Olexandr Shlapak stated that it was planned to create the so-called “bad bank”, a state bank for management of distressed assets. “It was told about Rodovid Bank as the basis for a “bad bank” – or the creation of the special independent bank. I have no doubt that it was and remains necessary for Ukraine. Several waves of financial crises seriously hurt our banks, and every bank has a number of bad assets. And something needs to be done with them”.
The ex-minister told that such an instrument is a common practice around the world, and it has proven its effectiveness. “We had a bill that we wrote together with representatives of the Japanese banking sector because they went through such a crisis and had a bad bank. The Turks also helped us, they also had such a problem. The essence is to create a bank of bad assets in Ukraine, where each bank can sell its assets according to a certain procedure and at a negotiated price. And “bad bank” itself would not specialize in ordinary banking operations. It should have the appropriate ability to work with these bad assets through the judicial and law enforcement systems. And it would be regulated not by ordinary banking, but by special regulations. In such a way, we could help so many banks transfer this “bad history” to a “bad bank” and thus free some energy for constructive operations” said Shlapak.
Olexandr Shlapak also said that in 2014, Oleg Bakhmatyuk, accused by NABU in allegedly illegal withdrawing of funds from a VAB bank, on the contrary, tried to deposit about $ 200 million into the bank to save him: “I remember that Bakhmatyuk, unlike many bank owners, fought for his banks to the last. And he didn’t use tricks like some of the owners did – by some rallies or other dirty methods. He was looking for a way to stabilize the bank financially, if not on his own (he did not have such resources at 2014), then at least by joining the resources of everyone who might be interested in this. As far as I remember, several schemes for further work with VAB Bank were proposed. The first… proposed unification of the state resources, the NBU and the owners of the VAB Bank with the aim of stabilization. About $ 200 million Bakhmatyuk was ready to pour into the bank. I don’t remember whether Valeria Gonaterva or Alexander Pisaruk signed it, but as far as I remember the conversation with Pisaruk, he said that the National Bank was ready to constructively consider such an approach and save the bank. What happened then and why the NBU refused, I can’t say. ”
Olexandr Shlapak noted that Bakhmatyuk proposed not only bring $ 200 million but also to service all the loans of his companies made in the bank, obviously with a certain restructuring of these obligations. “And if such an option was realized, we could save the bank. And most importantly, we could gain experience and a certain mechanism to show other owners of banks, that part of them who in good faith wanted to save their bank, that there is such an opportunity and owner who does not run away from responsibility can use it, – the ex-minister declared. – To Bakhmatyuk’s honor, he constantly turned to the Ministry of Finance, the National Bank and the government, he didn’t hide anywhere, but made various proposals, for saving VAB Bank, and then the Financial Initiative.
Commenting the case concerning the refinancing of a VAB bank opened by NABU, Olexandr Shlapak noted, that Oleg Bakhmatyuk’s agricultural holding Ukrlendfarming, the largest Ukrainian agricultural enterprise, may become a victim of such actions. “I am worried that if the state’s largest agricultural holding goes bankrupt (Ukrlendfarming, – Ed.), it will be the same story. Today we have an agricultural holding that produces a huge amount of agricultural products. This is the largest player in the Ukrainian market and abroad. Our Fund of Deposit Guarantee and law enforcement officers have learned to catch up with debtors, but none of them can manage assets as a business. So there is a possibility that tomorrow we will sell equipment, elevators that grow with weeds just like scrap metal and destroy a living business. Therefore, in 2014, we proceeded from the logic that if there is a minimal opportunity to save a particular bank, if the owner does not hide, but is ready to provide a real resource for his salvation and support, then you need to use this, and not act formally: if the bank is in bad conditions – get out of the market”.