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bank wrote off $800mn in non performing loans. This reduced the non-performing loans in its credit portolio from 55% of total assets at the start of the year, to 48% today. The bank’s NPL targest are: 37% in 2021; 11% in 2022; 7% in 2023.
Ukraine’s National Bank (NBU) recognized Ardaka Bank as insolvent,
according to its August 25 press release. The decision was based on the decrease of the bank’s capital to a negative value, the NBU reported. This happened because a creditor of the bank foreclosed on its main office (which accounted for 27% of the bank’s total assets) in a transaction that the NBU considers as illegal. The bank was 45th among Ukraine’s 75 banks by size of total assets, which were UAH1.9bn as of end-June (0.09% of the banking system’s assets). As of end-June, the bank held 403mn of individual deposits (0.06% of the banking system) and the NBU reported that UAH285mn of the deposits are guaranteed. The bank is known as a financing partner for large residential construction projects in Kyiv, through, which development firms have accumulated about UAH9bn funds from individuals, with a lot of the construction projects (over 30 multistoried buildings) failing to be completed. Before Arkada case, the latest bank that was recognized insolvent in Ukraine was ​VTB Bank in November 2018​.
Ukraine’s State Savings Bank Oshadny reported a 15% y/y rise in net interest income ​to UAH3.38bn in 1H20. This was the result of a 16% y/y slide in interest expenses on the background of a 7% y/y decline in interest income (to UAH9.23bn). The bank’s net commission income climbed 5% y/y to UAH2.03bn. Its total income surged 82% y/y to UAH8.66bn, which was largely the result of a UAH5.23bn gain on the revaluation of securities. This resulted in the bank’s bottom line surge by 29x y/y to UAH3.59bn. Meanwhile, its operating cash flow before assets/liabilities changes was just UAH0.18bn in 1H20 (vs. negative UAH0.25bn a year before). The bank boosted its portfolio of state bonds by UAH15.7bn YTD in 1H20 to UAH111.1bn, which reached 49% of the bank’s total assets as of end-June (from 38% as of end-December). It reduced its holding of the central bank’s certificates of deposit by about the same amount. Its net loan portfolio increased 5% YTD to UAH68.3bn in 1H20. The bank’s client accounts dropped 11% YTD (or by UAH21.6bn) to UAH180.5bn. The decline was solely the result of decreased deposits of state-controlled companies (by UAH37.3bn YTD, to UAH27.3bn), while the deposits of other businesses remained flat YTD. Moreover, individual deposits increased 15% YTD to UAH123.1bn, reaching 61% of the bank’s total liabilities as of end-June (from 47% as of end-December). Higher loans and fewer deposits halved the bank’s cash position YTD to UAH29.0bn. The bank’s total capital adequacy ratio improved to 16.3% as of end-June, from 13.9% as of end-December.
Net interest income at Ukraine’s State Export-Import Bank (Ukreximbank) plunged 40% y/y to UAH0.51bn in 1H20​. This was a result of a 21% y/y drop in interest income to UAH4.82bn amid a 18% y/y decrease in interest costs. Its loan loss provisions of UAH1.34bn and foreign currency losses of UAH3.13bn contributed UAH1.92bn ($6.9mn) in net losses in 1H20. Its operating cash flow before assets and liabilities change was negative at UAH0.65bn (5.3x deeper y/y). Meanwhile, the bank’s cash position improved 6% YTD to UAH35.4bn and total assets improved 14% YTD to UAH159.6bn in 1H20. The key growth drivers on its liability side were client accounts (up UAH15.9bn, or 21% YTD, to UAH93.0bn) and loans from IFIs (up UAH5.0bn, or 24% YTD, to UAH25.9bn). On the asset side, most of the increase was in securities, which rose
53​ UKRAINE Country Report​ September 2020 ​ ​www.intellinews.com