Another Privatbank depositor wins case against bail-in

Olena Bogoliubova, the former wife of key Privatbank
(PRBANK) shareholder Gennadiy Bogoliubov, won a case in a first-tier court
against the bail-in of her deposits in the bank amounting to UAH 0.5 bln, the
finbalance.com.ua news site reported on Nov. 19. The local court’s ruling was
approved in early September, but in early November the appellate court ruled to
return the case to a local court in order to “remove typos” and make some
additional rulings.

Recall, as part of the nationalization of the
insolvent Privatbank in December 2016, Ukraine bailed in UAH 29.4 bln of the bank’s liabilities, including
UAH 14.7 bln in Eurobonds and UAH 14.7 mln in deposits of related parties. One
group of bailed-in depositors, the Surkis family, won a case against the
bail-in in of UAH 1.1 bln in an appellate court in November.

Alexander Paraschiy: So far, the
state is losing most of the cases in local courts against those defined as
related parties of the bank, but the state still has a chance to win in the
higher courts. In any case, the interim victories of related depositors of
Privatbank should encourage the unrelated holders of the bank’s senior
Eurobonds, who clearly have a much better chance to win court cases against the
bail-in. But since these bondholders chose to sue in international court however,
it will take a lot of time until the rulings in their cases.

All this promises little positive for the Ukrainian
government, whose costs of the Privatbank bailout may increase by up to an
additional UAH 29.4 bln in the mid-term.