The National Bank has hosted the first meeting of the working group (Committee) for the settlement of bad loans of state-owned banks which was established according to the decision of the Council for Financial Stability.
The members of the Committee according to its rules of procedure are acting Minister of Finance Oksana Markarova, First Deputy Head of the National Bank Kateryna Rozhkova, Deputy Minister of Finance Yuri Heletiy, Advisor to the Minister of Finance Masaru Tanaka, Head of the Legal Department of the Ministry of Finance Olena Skrypkina, Director of the Financial Stability Department of the National Bank Vitaliy Vavryshuk, Director of the Banking Supervision Department of the National Bank Nataliya Degtyaryova, Head of the Legal Department of the National Bank Oleg Zamorsky and Deputy Managing Director of the State Deposit Fund Svitlana Rekrut.
The Committee members discussed the current operations of state-owned banks concerning their non-performing loans as well as considered key factors hindering the effective protection of banks’ interests in their interaction with non-diligent loan-takers. It was decided to develop general principles for NPL settlement by state-owned banks and to adopt them at the next Committee meeting.
“All these banks are state-owned, but each of them is an independent commercial entity. Each of them has its management board and supervisory board, each of them pursuits its own commercial interests. Hence, it is hardly possible for them agree between themselves on how it is best for the state to settle bad debts. The management boards of these banks will be receiving recommendations via their supervisory boards. It shall enhance the efforts of the banks themselves and speed up the NPL settlement,” Oksana Markarova explained.
According to the Committee’s decision and IMF recommendations, the Ministry of Finance – starting from the end of December 2018 – will be regularly informing the public about the progress of NPL settlement at state-owned banks.
The Settlement Committee (working group) for Non-Performing Loans of State-Owned Banks was established in July 2018 according to the decision of the Council for Financial Stability. Its members are representatives of the National Bank, the Ministry of Finance and the State Deposit Fund. The key task of the Committee is to develop and to provide recommendations to the management bodies of state-owned banks concerning their non-performing loans.