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parliament approved on Sept. 12 the so-called “split” law aimed at re-distribution of regulation powers on the market of financial services. The bill drew 296 votes, including the mono-majority People’s Servant party, Voice party and the opposition European Solidarity party. The law envisages that starting July 1, 2020, the National Commission on Regulating the Markets of Financial Services will be liquidated and its functions will be split between the National Bank of Ukraine and the National Security Commission. The bill aims to cut the number of regulatory and controlling bodies on the market of non-banking financial services. The National Security Commission is supposed to regulate and oversight the non-state pension system, property management under construction and real estate operations. The NBU will be in charge of licensing and regulating non-banking financial services (including insurance, leasing, financial companies, credit unions, pawn shops, and the bureaus of credit history). The NBU’s oversight will include the regular assessment of non-banking financial companies, including risk assessment. It is also to develop the rules for reporting by such companies. In related news, the NBU released an announcement on the same day noting that this law will ensure a balanced and systemic approach for the effective development of the non-banking financial sector and the protection of consumer rights on the financial market. The NBU emphasized that the adoption of the law on “split” was the key requirement of Ukraine’s international financial institution.
Fitch Ratings upgraded the issuer default ratings of all Ukrainian state-owned banks to B with a Positive outlook​, the agency reported on September 24. The rating move mirrors the recent upgrade of Ukraine’s sovereign rating and outlook. The upgrades apply to Oschadbank (OSCHAD), Ukreximbank (EXIMUK), Privatbank (PRBANK) and Ukrgazbank, reflecting Fitch's view that “the authorities' ability to provide support to the banks, in case of need, has improved”. Recall, following the sovereign rating upgrade on September 6, Fitch upgraded the ratings of poultry and crop producer MHP (MHPSA) to B+, Ukrainian Railways (RAILUA) and Naftogaz (NAFTO) to B, and Metinvest to BB-.
8.1.4 ​Bank news
The Permanent Court of Arbitration in Hague has rejected Russia's claim to reconsider its findings on jurisdiction and liability as set out in its previous awards regarding hearings of a lawsuit filed by Ukraine's state-owned PrivatBank​, nationalised in late 2016. In February, PrivatBank secured a partial award​ in its favour in the Permanent Court of Arbitration at the Hague, where the lender is challenging Russia's expropriation of the bank's investments in Ukraine's Crimea. Specifically, the arbitral tribunal found that it has jurisdiction over all of PrivatBank’s claims against Russia, that Moscow breached its obligations under the Ukraine-Russia bi-lateral investment treaty by unlawfully expropriating PrivatBank’s investments in Crimea, and that PrivatBank is entitled to full compensation for that expropriation. The arbitral tribunal reserved for the next phase of the arbitration the question of how much compensation is due to PrivatBank for Russia's 'unlawful actions'. PrivatBank seeks compensation in excess of $1bn. Russia did not participate in the arbitration until after the tribunal had issued its awards. "The Russian Federation has now appointed counsel of record in the arbitration, and the proceedings will continue to their next phase," PrivatBank said in a statement e-mailed to ​bne IntelliNews​ on September 13.​ ​In June​, PrivatBank's deputy board chairperson Halyna Pakhachuk said that the lender's estimates its
48​ UKRAINE Country Report​ October 2019 ​ ​www.intellinews.com