The Ukrainian government has injected some $15.5 billion into a multitude of state-owned banks since 2008. The country could continue spending funds without improving the quality of corporate governance in those organizations and their supervision. Francis Malige, who is the current Managing Director for Eastern Europe and the Caucasus at the European Bank for Reconstruction and Development (EBRD), wrote this on his Facebook page, Interfax-Ukraine reports.
According to Malige, a total of $5.8 billion was spent on additional capitalization of Privatbank, another $3.5 billion were injected in Oschadbank, while Ukreximbank received a total of $2.8 billion. Similarly, some $1.6 billion were invested into Rodovid Bank, another $1.4 went to Ukrgasbank, whereas Bank Kyiv received $0.5 million.
Malige added that the aforementioned figure does not even account for the costs of the insolvent banks that were transferred to the Deposit Guarantee Fund.
The official went on to suggest that should the governance practice and supervision of banks remain unchanged, the cost of operating these insolvent financial institutions is likely to keep climbing.
“The current situation is not robust enough to prevent further connected lending. A law on state banks is necessary for Ukraine,” the official wrote.
As reported earlier, on 21 June, the Parliament of Ukraine sent bill #8331 on the reformation of supervisory boards of state-owned banks for repeated first reading.