Business news from Ukraine

ASTERS AND EPAP FIRMS INTEND TO MERGE, NEW LAW FIRM WILL BE THE LARGEST IN UKRAINE

The law firms Asters and EPAP Ukraine (Egorov Puginsky Afanasiev & Partners, Kyiv) have announced their intention to unite. According to a joint press release of the companies, the firms are to merge on October 1, 2018. “The combined firm with its offices in Kyiv and Washington will be the largest in Ukraine with 26 partners and more than 140 lawyers,” the press release reports.
The company will be headed by a committee of three partners, namely Oleksiy Didkovsky (the managing partner of Asters), Armen Khachaturyan (the senior partner of Asters), and Serhiy Svyryba (the managing partner of EPAP Ukraine). “The merger process will be completed after obtaining the necessary regulatory permits. Asters and EPAP Ukraine will consolidate professional experience of the best specialists, significantly strengthen expertise in both transactional and regulatory practices, and in the field of dispute resolution,” the press release says.
The Asters and EPAP Ukraine law firms have been working in Ukraine for more than 20 years. They are the leaders of the legal market, have the highest recommendations of international and national ratings. The international rating Chambers Europe 2018 notes 22 lawyers of the future joint firm: the largest number of recognized experts in one law firm in Ukraine.

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AMERICAN-BASED CITIBANK-UKRAINE PLANS TO PAY UAH 970 MLN – TO SHAREHOLDERS

Citibank (Kyiv) has decided to pay UAH 972.582 million in dividends to its shareholders, the bank said in the information disclosure system of the National Securities and Stock Market Commission. According to the report, the shareholders of the bank made the decision at a general meeting on August 8, 2018. The register of shareholders is to be composed on August 27. The financial institution in 2017 paid UAH 1.269 billion in dividends. Citibank was founded in 1998. It is a subsidiary of the American-based Citibank NA. The largest shareholders of the financial institution on January 1, 2018 were Citibank Overseas Investment Corporation (67%) and Citicorp Leasing International LLC (33%). Citibank in January-June 2018 received a net profit of UAH 627.989 million, which is 4.9% more than for the same period in 2017 (UAH 598.313 million). Citibank ranked 14th among 84 banks in terms of total assets on June 1, 2018 (UAH 20.593 billion), according to the National Bank of Ukraine.

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INGO UKRAINE LIFE INSURER INCREASES INSURANCE PREMIUMS BY 5.8% IN JAN-JUNE 2018

INGO Ukraine Life insurer (Kyiv) in January-June 2018 collected UAH 20.2 million of insurance premiums, which is 5.8% more than in January-June 2017, according to a press release of the insurer.
The total amount of insurance claim fee payments was UAH 6.8 million (26.4% more). Of these, UAH 624,100 were paid for deaths, UAH 2.504 million for cases of disability establishment, UAH 1.832 million for hospitalization and temporary disability, and UAH 1.749 million in connection with critical diseases.
In addition, for the six months payments were made for long-term accumulative insurance contracts related to the surviving of the insured person by the end of the insurance period for a total of UAH 70,200.
The largest payments for this period were as follows: UAH 1.498 million in connection with the establishment of the second group of disability due to a critical illness, UAH 936,000 in connection with the diagnosis of a critical illness.
INGO Ukraine Life received an unlimited license to carry out life insurance activities in November 2007. Since April 26, 2013 it has been representing the interests of Generali Employee Benefits (GEB) in Ukraine.

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MONEY SUPPLY IN UKRAINE 1.3% UP IN JULY – NBU

Money supply in Ukraine in July 2018 increased by 1.3%, to UAH 1.229 trillion, such preliminary data of monetary statistics are posted on the website of the National Bank of Ukraine (NBU).
According to the central bank, this dynamics is due to the growth in the balance of deposits by 1.7%, to UAH 881.579 billion, and the amount of cash in circulation outside banks by 0.8%, to UAH 346.654 billion.
In general, since early 2018 money supply has increased by 1.6%.
The NBU said the deposit portfolio of banks in the national currency in July rose by 1.5%, to UAH 515.475 billion, in foreign currency by 2%, to UAH 366.104 billion.
In general, since the beginning of the year the deposit portfolio of banks has increased by 0.6%, in particular, in the national currency by 5.1%. The deposit portfolio in foreign currency decreased by 5%.
The yield of deposit products in the national currency for business last month increased by 0.4 percentage points (p.p.), to 12% per annum, in foreign currency declined by 0.2 percentage points, to 1.9% per annum.
In general, in January-July 2018 the rate on hryvnia deposits for business increased by 3.3 percentage points, while on foreign currency deposits fell by 0.9 percentage points.
The interest rate on deposits for the population in July did not change either in the national currency or in foreign currency.
Since the beginning of this year, the rate on deposits for the population in the national currency has increased by 0.2 percentage points, to 10.7% per annum, while in foreign currency it decreased by 0.4 percentage points, to 2.3% per annum.
The loan portfolio of the banks in July increased by 1.9%, to UAH 1.043 trillion. In particular, the volume of loans in the national currency increased by 1.5%, to UAH 593.749 billion, in foreign currency it decreased by 2.3%, to UAH 449.452 billion.
Since the beginning of the year, the loan portfolio of the banks has grown by 2.7%, in particular in the national currency by 4.2% and in foreign currency by 0.8%.
According to the NBU, the cost of hryvnia loans for business last month decreased by 0.1 percentage points, to 16.9% per annum, foreign currency loans by 0.5 percentage points, to 6.1% per annum.
In general, for the seven months of the year the cost of loans for corporate borrowers in the hryvnia rose by 2.7 percentage points, in foreign currency decreased by 1.4 percentage points.
The cost of hryvnia loans for the population increased by 0.2 p.p. in July, to 32% per annum, in foreign currency by 4.3 percentage points, to 10% per annum.
Since the beginning of 2018, the cost of borrowings for the population in the national currency has increased by 3.3 percentage points, in foreign currency by 1.6 percentage points.
The monetary base in July rose by 0.2%, to UAH 420.598 billion. The growth for the seven months was 5.4%.
Net international reserves in July decreased by 2.9%, to $6.832 billion, the banks’ debt on refinancing loans fell by 0.1%, to UAH 58.58 billion.
In general, since early 2018, net foreign exchange reserves increased by 2.4%, the banks’ debt on refinancing loans decreased by 14.7%.

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UKRAINIAN PRESIDENT SIGNS LAW STIMULATING ACTIVITIES OF FAMILY FARMS

Ukrainian President Petro Poroshenko has signed the law introducing amendments to the Tax Code of Ukraine and some laws of Ukraine on stimulating the creation and operation of family farms, which allows citizens living and working on their land to obtain the official status of farmers, sell their products and get social protection and the right to a pension. A statement posted on the president’s website on Friday says the document amends the Tax Code and the laws of Ukraine on farming, on state support for agriculture in Ukraine, on the collection and accounting of a single contribution to compulsory state social insurance, and on state registration of legal entities, individual entrepreneurs and public organizations.
According to the changes in the law, the entrepreneurs who organized the farms belong to the payers of the single tax of the fourth group of individual entrepreneurs. The law foresees the provision of state aid to pay a single contribution to compulsory state social insurance (from 10% to 90% of the minimum insurance payment) for each member of the farm for ten years at the expense of the state budget of Ukraine through the mechanism of additional payment in favor of insured members of a family farm of a single contribution to state social insurance. The document also clarifies a number of clauses on the establishment and operation of a family farm without acquiring the status of a legal entity. The implementation of the law will help create conditions for the creation of family farms and bringing entrepreneurial activity in the agrarian sphere out of the shadows, which will positively influence the growth of revenues to local budgets from the payment of taxes and creation of new jobs in rural areas.
As reported, the Verkhovna Rada on July 10 adopted at second reading, with technical and legal amendments, draft law No. 6490-d introducing amendments to the Tax Code of Ukraine and some laws of Ukraine on stimulating the creation and operation of family farms.

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EUROPEAN UNION: ANTI-CORRUPTION COURT IS AN IMPORTANT STEP IN FIGHT AGAINST CORRUPTION IN UKRAINE

The European Union views the adoption of legislation to create a High Anti-Corruption Court in Ukraine as a positive event that meets its international obligations and the interests of Ukrainian citizens and enterprises, the official spokesperson of the European External Action Service has said. “Ukraine’s adoption of the legislation with a view to establishing a High Anti-Corruption Court is a positive development in accordance with its international obligations and to the benefit of Ukrainian citizens and businesses. The establishment marks a significant step in the crucial fight against corruption in Ukraine which is a key component of the EU-Ukraine Association Agreement and follows the commitments taken by Ukraine during the EU-Ukraine Summit in Brussels on July 9,” a report on the agency’s website reads.
“Once established, the High Anti-Corruption Court will complete the chain of independent anti-corruption institutions that also includes the National Anti-Corruption Bureau and the Specialized Anti-Corruption Prosecutor’s Office. The EU underlines the need for all anti-corruption institutions to be fully independent and carry out their tasks free from undue influence. To this end, it is important that the integrity and credibility of the Office of the Specialized Anti-Corruption Prosecutor and its leadership are upheld and reinforced,” it says. “We look forward to the court being fully operational before the end of the year as this is the intention of the authorities. What counts now, what will support the country and its people to fight against corruption will be the full implementation of this act. The European Union stands ready to support the process,” the document states.

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