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Where there is no law, but every man does what is right in his own eyes, there is the least of real liberty
Henry M. Robert

NATIONAL BANK FORBIDS DEBTOR BANKS TO PAY DIVIDENDS TO SHAREHOLDERS FOR 1997

3 March, 1998 - 00:00

The Ukrainian News Agency reports that the National Bank of Ukraine has banned domestic banks which failed as of January 1, 1998, to meet their reserve commitments to the NBU accounts to pay dividends for 1997 to their shareholders. The deadbeat banks have been ordered to cut on their administrative and social payments until they repay their debt in full.

In November of 1997, the NBU increased reserve requirements from 11 to 15% of accumulated funds in the national and foreign currencies and 4% of their assets in OVDPs, or T-bills, bought at the primary securities market. Such a decision should have increased bank reserves by about UAH 330-400 million. In January of 1998, the NBU announced a moratorium on the fines on debtor banks, due to the banks switch at the time to international bookkeeping standards. The reserve shortage reached approximately Hr 100 million in January, according to NBU governor Viktor Yushchenko. One of the largest debtors in January of 1998 was the Prominvestbank, says NBU deputy governor Oleksandr Kireyev.

INFOBANK

 

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