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Ukrainian central bank extends capital-boost deadlines for local lenders

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Ukrainian central bank extends capital-boost deadlines for local lenders

TheNational Bank ofUkraine said April 8 it extended certain deadlines for local banks to increasetheir authorized capital to meet required minimum levels.

Thedecision was preceded by "lengthy discussions" with the bankingcommunity, which put forward a number of "compelling arguments," suchas the banks' inability to use their 2016 profits to boost capital, lengthymerger proceedings and difficulties in finding investors in the currentclimate, the central bank's deputy governor, Kateryna Rozhkova, said.

Underthe new plan, banks will still be required to increase their minimum authorizedcapital to 120 million Ukrainian hryvni by June 17. However, rather than havingto hold at least 300 million hryvni by Jan. 11, 2017, they now have to have aminimum authorized capital of 200 million hryvni as of July 11, 2017.

Thedeadline to bring it to the level of 300 million hryvni is now July 11, 2018,while further capital hikes to 400 million hryvni and 450 million hryvni havebeen pushed back 18 months to July 11, 2019, and July 11, 2020, respectively.

Theoriginal deadline to increase minimum capital levels to 500 million hryvni byJuly 11, 2024, remains unchanged.

Thecentral bank added that banks have to submit recapitalization programs by Jan.11, 2017.

As of April 7, US$1 wasequivalent to 25.80 Ukrainian hryvni.