Ukreximbank gets new CEO after scandal

Yehven Metsger was
appointed CEO of Ukreximbank (EXIMUK) on Mar. 13 after his candidacy, nominated
by the supervisory board, was approved by state regulators, Interfax-Ukraine
reported on Mar. 16. Metsger’s last position was deputy director at another
state-controlled bank, Ukrgazbank, where he was responsible for SME lending.

The position of
Ukreximbank CEO became vacant after Oleksandr Hrytsenko was detained by the State Security
Service on Nov. 16.
Shortly after that, the bank’s supervisory board announced a competition for
the new CEO. Rumors that Metsger will head the bank surfaced in late November
as media reported on his friendship with President Zelensky. Last year, the
president appointed Yehven’s wife, Yulia Metsger, to the supervisory board of
another state bank, Privatbank (PRBANK). An initial plan, involving a quick
appointment of Yehven Metsger as Ukreximbank CEO, was spoiled by American
Steven Fisher, who used to be a supervisory board member and led the selection
process of CEO candidates, according to media reports. Due to Fisher’s
activity, Metsger was not short-listed to be among the three best CEO
candidates in early December, and because of that the results of the
short-listing were cancelled on Dec. 6.

On Dec. 27, Ukraine’s
Cabinet of Ministers issued a resolution to “cancel the authority” of Fisher as
a member of Ukreximbank’s board without explanation. Without Fisher, the bank’s
board approved Metsger’s candidacy as CEO on Feb. 6.

Alexander
Paraschiy: This
appointment confirms nothing has changed in the corporate governance practices
of state banks: a friend of ex-President Poroshenko has been replaced by a
friend of the new president as Ukreximbank CEO. Meanwhile, the corporate governance reform of
state banks, initiated in mid-2018 and completed in the last days of Proshenko’s
presidency (when six out of nine state banks’ supervisory board members were
appointed as “independent members”), has been already criticized by President
Zelensky, who complained on Mar. 4 that “Ukrainian citizens are feeling like a
national minority in the boards of state companies.” Such comments reflect
Zelensky’s new politics of abandoning his lip service to Western reforms (and
whatever little commitment he gave them) and full embrace of populism.

Whatever experience and skills Metsger has to head a state bank focused
solely on corporate lending, we believe that his appointment will change little
in the bank, which will likely remain a politicized, technologically lagging,
Soviet-style financial institution. At the same time, given the alleged close
ties of the bank’s new CEO to the president, the bank will definitely remain
well-capitalized and financially healthy.