Zelensky assures EU he won’t adhere to Kolomoisky on Privatbank, default

Visiting Brussels on June 4 in his first foreign
working visit as president, Volodymyr Zelensky assured EU Commission
Vice-President Valdis Dombrovskis that he is not considering the option of
Ukraine defaulting its on international debt, the presidential administration
reported. “Regarding default – these are rumors. These are orchestrated
campaigns that have nothing to do with my official position,” Zelenskiy said in
Brussels.

Recall, in late May, the Financial Times published an
interview in which tycoon Ihor Kolomoisky called upon the Ukrainian government
to consider the option of defaulting on its international creditors.
Kolomoisky is widely considered to have influence over Zelensky, having financed
his election campaign, promoted his campaign on his 1+1 television network,
having broadcast Zelensky’s entertainment content, and having his personal
lawyer, Andriy Bohdan, being appointed to head Zelensky’s presidential
administration.

During his visit, Zelensky also commented on the court
attempts of Kolomoisky, the former majority shareholder of Privatbank (PRBANK),
to recover his equity rights over the bank. “Regarding Privatbank, I will
protect only the state, only its citizens. I do not care about these games of
the former owners in the courts. I’m not going to be on their side,” Zelensky
told Dombrovskis.

Alexander Paraschiy: While key
officials close to Zelensky have rejected publicly the option of
default, this was the first time he personally addressed this
issue since the FT interview was published. This should give surety to
international creditors that the Ukrainian government is not seriously
considering any default, as there is no fundamental basis for that. That said,
we expect the next time any journalist takes an interview from Kolomoisky, who
is likely to repeat his default recommendation, there won’t be any noticeable
reaction of the bond market.

Meanwhile, Zelensky’s rhetoric on Privatbank has not
changed from his election campaign, so much will depend on the litigation in
Ukraine. It’s essential for the president to clearly demonstrate that he is not
influencing any court in Privatbank’s cases.