Privatbank repays UAH 1 bln in bailed-in deposits of Surkis family, media report

Ukraine’s biggest lender Privatbank (PRBANK) has resolved
the Surkis family’s complaint against the bail-in of its bank deposits and has
agreed to repay the family, Interfax-Ukraine reported on Sept. 24, citing its
sources in the bank. “Over UAH 1 bln has been already recovered,” according to
the source. Commenting on the issue, the Privatbank press service clarified to
Interfax that the bank has not paid anything following an appellate court
ruling in favor of the Surkis family. Privatbank is now appealing that decision
in the Supreme Court of Ukraine. The bank also stated that it has enough
liquidity to implement any court ruling, without the need to raise additional
capital. 

Recall,  the Appellate Administrative Court of
Kyiv rejected in November 2017 Privatbank’s
appeal of a ruling that obliged the bank to compensate the deposits of the
Surkis family amounting to UAH 1.1 bln. The National Bank of Ukraine reported
then that it has filed a cassation request to the Supreme Court.

The deposits of the Surkis family were exchanged for
new shares of Privatbank in December 2016 as part of a UAH 29.4 bln bail-in,
which followed the recognition of the bank as insolvent and preceded its
nationalization. Together with the Surkis deposits, the bank also bailed-in its
USD 555 mln in Eurobonds.

Alexander Paraschiy: Based on this information, Privatbank appears to have resolved its
issues with the Surkis family out of court. That is encouraging for the
bailed-in holders of Privatbank Eurobonds as it increases the likelihood that
the bank will offer some out-of-court resolution for them as well.