7 October 2011
The National Bank of Ukraine recalled its temporary supervisor from Finance & Credit Bank, NBU First Deputy Head Yuriy Kolobov said yesterday (via Interfax). The NBU appointed the supervisor to “monitor” day-to-day operations at the bank on July 26. F&C Bank was Ukraine’s #10 largest bank by assets (UAH 24.4 bln) as of July 7, 2011, according to data from the NBU. Brad Wells: The spreads on F&C Banks’s 2014 Eurobonds over the sovereign curve doubled from 800-1,100 bps to over 2,000-2,600 bps since late July and YTM has risen to over 40%. Finance & Credit Bank is one of a number of assets in Ukraine owned by Konstantin Zhevago, which have been the subject of raids by the Security Service (SBU, Ukraine’s successor to the KGB), intrusive tax inspections and other forms of pressure by the authorities (see our note dated September 21 for more). We continue to see little impact on Zhevago’s LSE-listed asset Ferrexpo (LSE: FXPO LN, N/R); its 9M11 output results released yesterday continued to indicate slow, stable growth in production (see our separate news item today on Ferrexpo production results).