Top twenty Ukrayina debtors named
Checking the solvency of bankrupt Bank Ukrayina’s corporate debtors could take some time, Deputy Head of the Main Auditing Department Serhiy Kirutsa said. According to him, the twenty largest debtors of Ukrayina accounting for almost 75% of Ukrayina’s total indebtedness have been screened so far. “We thought that checking these clients out would be sufficient, but the shots here are called by the Prosecutor General’s Office, and it ruled that all the debtors without exception to be screened,” Mr. Kirutsa confirmed. There is no knowing when the verification of all the deadbeats will be completed as there are many small companies among them that have already been liquidated, he admitted.
The screening of Ukrayina debtors was launched in the fall last year by the Main Auditing Department on orders from the General Prosecutor’s Office. Following the check, GPO wants to freeze funds that could be used to pay off debts to the bank’s ill-fated clients. To date, entities with over UAH 500 million in liabilities to Ukrayina have been checked out, but auditing department experts consider 60% of this total as bad debts. Serhiy Kirutsa says that his experts have to seek high and low for documents concerning liabilities to Ukrayina as the entities are reluctant to produce them.
Simultaneously, the auditors failed to come up with any confirmation of Ukrayina governors’ complicity with major loan recipients. “Our verification technique lies in screening accounting and financial documents, and we have not been able to reveal any facts indicating complicity,” the Main Auditing Department Deputy Head says. Neither are there any documents confirming pressure on the bank from the government to extend credit to chosen companies been found. But auditors seldom have access to such documents.
Still, Mr. Kirutsa maintains that the study of accounting and financial reports gives reason to conclude that until its end Ukrayina continued to extend dubious loans. In addition, Ukrayina’s managers spurned NBU instructions aimed at warding off its bankruptcy. It is also quite clear that, for unknown reasons, virtually no attempts have been made by the bank to bring its major debtors to account. The reasons will apparently be investigated by the prosecution, to which auditors will submit the relevant information.
Thus far it is unclear when the General Prosecutor’s Office will step up its efforts to seize the assets of Ukrayina debtors. With the information on the top twenty largest deadbeats passed to the prosecutors, the auditors now enter the most difficult stage, searching for small firms, some of them bogus, whose assets typically include nothing but office furniture. Ukrayina’s aggrieved clients can only hope that the GPO will move quickly to seize the assets of the top twenty debtors before it finishes checking the small timers.
Meanwhile, the bank’s receivers are involved in more down-to-earth things, like selling its assets at auctions for clients. The next one is due on June 11. The past ones were bad news as, for example, a mere UAH 3 million was received although UAH 16 million worth of property went under the hammer in the last auction. Those wishing to buy bank-owned apartments, garages, and unfinished construction projects can apply to the Kyiv Auctions Center now. But Ukrayina’s debtors still have time left to escape such a plight.
