Oleksandr Klymenko Official website
Articles | 1557 | 19.12.2016

What should Ukrainians expect from nationalization of PrivatBank

Nationalization of Privatbank Igor Kolomoisky. Actions Poroshenko and Gontareva. Implications for Ukraine

Petro Poroshenko and Ihor Kolomoisky have already received their New Year’s presents in advance. Their plan “to withdraw money and transfer empty bank to the state” has been successfully completed.

Their agility is really impressive.

During the last three years, PrivatBank was intensively vanishing Ukrainian citizens. It means that it was collecting funds of population money in the form of deposits, favourable interest rates, and launching corresponding services for business. In addition, shareholders of the Privat thwarted several jackpots, such as refinancing by the National Bank of Ukraine (in fact, it comes about vanishing state savings too) –  UAH 20.8 billion, UAH 7.7 billion, etc. – and took money of IMF. According to reports, it was spent by the PrivatBank in order to cover the outflow of individual’s funds. The total amount was enormous, about UAH 200 billion. After that, funds were given in the form of “insider” loans. Therefore, money was withdrawn from the bank to “own” enterprises. Moreover, money on their accounts were not just saved, but it was also withdrawn to offshores. It comes about 96% – just imagine – of the total amount!

At the same time, management of the PrivatBank launched a large-scale deterioration of mortgaged property. Thus, it became not profitable to take away the bank. It started to restructure loans on SPVs, to substitute guarantees, to put enormous depts on pledge enterprises.  Pledges were often registered at inflated prices. Banking assets became toxic, the bank was transformed into a “black hole”, which devour money. It is interesting, what did Gontareva nationalize aside from debts? Can her employees show inventory numbers of offices, furniture, or at least stationery? It is all “firmly under control” of shareholders of the Privat: the lion’s share of the bank’s property is leased.

What did shareholders of the PrivatBank get due to nationalization?

Actually, «profit» of the shareholders of the Privat is $ 4-5 billion. It is about UAH 5-7 thousand, which became a burden for each Ukrainian citizen. Sooner or later we will pay money for it – in taxes, excises, or simply due to the inflationary effects.

What is the issue price for Petro Poroshenko?

There is also no mystery: among the assets that were «put on» the bank by Kolomoisky there are interesting assets for the President and his entourage. It comes about Ukrainian International Airlines, Bukovel resort, and even “1 + 1” TV channel. There is a high probability that all assets will be nationalized and become the state property. When officials will have enough time to enjoy the winter in Bukovel, it will be organized a program of loyalty “for close circle”. The companies will be “privatized” by the right hands.

In fact, “nationalization” means a large-scale consensus of oligarchs behind the back of ordinary people. Do you remember the state’s actions dealing with other «problem» banks, such as «Mikhailovsky», «Khreshchatyk»? There were allegations, opened criminal procedures (the current government is the best in this field) against the heads and members of the board, other top representatives were accused, plethora of them were «closed» during the investigation, the majority was deprived of the right to leave the country.

Top management of the PrivatBank easily stand in from of the journalists and talk about the technological level of the bank. We were explained: everything is ok, the state will pay for everything, the issue price is UAH 148 billion ($ 5.6 billion according to the exchange rate). In fact, these funds belong to Ukrainians – it could be spent on construction of roads, insulation of houses. How can the state that has not enough money for student’s scholarship even talk about sponsoring of the oligarch? It turns out that it can, if we talk about Ukraine during the times of Petro Poroshenko.

The risk of nationalization is in fact that business will leave the bank. A number of software products, such as “Privat48”, or P2P-lending (when individual gives a credit to legal entity or other individual using a bank as a mediator) – are so profitable that 80% of the systems of enterprises are «put» on it. Will it operate in case of meticulous monitoring of each transaction by the State Fiscal Service? There are no doubts that tax payments will be charged after 6 years-1 year (when the turn comes up their business). Will it operate after this? It is a big question.

However, the issue has been already resolved for microbusiness, individual entrepreneurs, entities, which pay Single tax. Huge amounts of electronic payments – for goods and services, mutual settlements, prepayments – were flowing via the bank through “Privat24”. It is easy to use it during the crisis: put the bank details – receive payment without reports. You just have to pay Single tax. Nowadays, they will be also under the microscope of tax authorities and the Ministry of Finance, which can charge additional sums at any moment. By the way, the Security Service of Ukraine and other competent authorities have interfered in the system and started a monitoring of the data concerning the “problem” operations since the end of summer 2016. For instance, it helped representatives of law enforcement agencies to complete several famous operations on suppression of “terrorist financing”. It comes about the transfer of sums, including small sums of money, to the regions of ATO area.

It also raises another extremely important issue. Donbass is a consumer of goods and services of the «big Ukraine». Despite the desire of Oleksandr Turchynov to cut these flows off, there are such flows. It is an objective reality. Among the demarcation line, services of the PrivatBank are almost the only possible bank services. Do you want to allocate funds fairly? Use a terminal. Do you want to pay for services? Go to the bank office nearby. The PrivatBank started to earn good money for this. It even started to open new offices. Nowadays, there is a great risk that the flow of “half-white” funds from the uncontrolled territories (and vice versa) will be transformed into a “thread-needle”. Will people, who are frightened by representatives of law enforcement agencies, use services of the state bank?  Hardly. As a result, money will be move into the “black” area with its all usual attributes – «big brothers», suitcases and risk. Although, Turchynov can be satisfied – thugs, who are related to him and Arsen Avakov, under the guise of battalions will be able to get “live money”. You need only to “bang” the right machine. In its turn, for the country it is a direct threat to security and a prerequisite for chaos on the roads.

It is more important that the most important event – nationalization of one of the largest banks in the country – took place “under cover of darkness”, with gossips and rumours that were dispersed in all kitchens. People were «fleetly» told about nationalization at 23:29 on Sunday. How can you to behave this way with people, who become nervous, when they see Valeria Gontareva on the TV screen? With citizens of the country, which came through a “murder” of 87 banks? They climb into the person’s pocket in order to take away UAH 5-7 thousand instead of saying “thank you”. Millions of Ukrainians are just a “biomass” for them again.

Link to source: Official website of Oleksandr Klymenko

Photo: kordon.com.ua