NBU revokes license and liquidates Cominvestbank
11 March 13:30
The National Bank of Ukraine (NBU) has decided to revoke the banking license and liquidate Cominvestbank JSC. The decision was made based on the findings of the Deposit Guarantee Fund (DGF), Komersant ukrainskyi reports citing the National Bank.
Why was Cominvestbank liquidated?
In August, the NBU classified Cominvestbank as a problem bank due to its risky activities that threatened the interests of depositors and creditors. At that time, the NBU identified a number of problems, including manipulation of the bank’s financial statements to conceal its real financial position.
According to the NBU, Cominvestbank’s assets amounted to UAH 1.3 billion (highly liquid assets – UAH 890 million), capital – UAH 349 million, and liabilities – UAH 980 million. The bank’s market share amounted to 0.04% of all assets of solvent banks as of November 1, 2024, and its classification as insolvent will not affect the stability of the Ukrainian banking sector, the NBU said.
What will happen to Cominvestbank’s assets?
On December 6, 2024, a temporary administration was introduced at JSC Cominvestbank based on the decision of the NBU Board “On classifying JSC Cominvestbank as insolvent” and the decision of the Executive Directorate of the Deposit Guarantee Fund “On introducing a temporary administration at JSC Cominvestbank and delegating the powers of the bank’s temporary administrator”.
And on December 9, 2024, the Deposit Guarantee Fund announced an open tender to attract an investor/accepting bank to withdraw the insolvent JSC Cominvestbank from the market.
The winner of the tender was JSC ASVIO BANK, which proposed the least costly way to withdraw the bank from the market – alienation of a part of assets and liabilities in favor of the receiving bank with further liquidation of the insolvent bank. In total, 5 people expressed interest in participating in the competition.
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What will happen to the bank’s customers
The regulator noted that each depositor of Cominvestbank will receive compensation from the Deposit Guarantee Fund in the full amount of the deposit, including interest accrued as of the end of the day preceding the day of the start of the bank’s withdrawal from the market, except as provided for in part four of Article 26 of the Law of Ukraine “On the Individual Deposit Guarantee System”.
As of November 21, 2024, the total possible amount of the guaranteed amount to be paid to the depositors of Cominvestbank is UAH 432 million.
As of December 4, 2024, the bank’s highly liquid assets, including government bonds and certificates of deposit, amounted to UAH 890 million.
It is worth noting that the assets of insolvent banks are sold by the Deposit Guarantee Fund at auctions at prices that are significantly lower than their book value and even their appraised value. As of early April 2024, 54 insolvent banks were in the process of liquidation.
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The carrying value of the assets sold by insolvent banks amounted to UAH 631.2 billion. However, their estimated value was determined at UAH 92.3 billion.
What is known about Cominvestbank
JSC Cominvestbank was a regional financial institution founded in 1993. Its head office was located in Uzhhorod, and most of its clients were small and medium-sized businesses.
The main shareholder of Cominvestbank is Volodymyr Hisem, who runs the Uzhhorod Cognac Factory and, according to public registers, is its beneficial owner.
According to YouControl, 42% of the bank’s shares are owned by Uzhhorod Cognac Factory (the company is in a state of liquidation), Latut LLC, and Plodovoch-Uzh LLC.
Prior to liquidation, the bank had a rather narrow specialization and a limited customer base, which, combined with financial difficulties, led to its bankruptcy.
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