The National Bank of Ukraine (NBU) has asked the law enforcement agencies to investigate into activities of Royal Standard LLC, which attracted funds of depositors at high rates – 24-33% per annum in hryvnias and 18-22% in U.S. dollars, the NBU has reported. “The NBU does not grant licenses for attracting deposits or lending to entities that do not have the status of a bank, while the company has not received these licenses from other financial sector regulators – the national commission for financial service markets regulation and the National Commission for Securities and the Stock Market. Moreover, Royal Standard LLC does not have the status of a financial institution. That is, the company by law cannot attract deposits and issue loans,” the National Bank wrote on its Facebook’s page.
According to the NBU, Royal Standard offers investors to deposit cash directly at the office of the company or transfer it to its bank account, and the interest is promised to be paid to a bank card, the details of which are specified in the contract. As a guarantee of the deposit with the depositor, a pledge of rights to movable/immovable property is concluded, whereby the depositor receives a security deposit for property worth twice more than the value of the deposit. “People are explained that, in addition to accepting deposits, the company also provides loans to other persons securing them by property, namely, the rights to this property are transferred to depositors as a guarantee of the deposit. Market value and the existence of this property raise doubts,” the National Bank said.
The growth of Ukraine’s gross domestic product (GDP) in the second quarter of 2018 slightly accelerated, to 3.2% from 3.1% in the first quarter, the National Bank of Ukraine said in the July inflation report. “In Q2, 2018, Ukraine’s economy kept growing. The high business expectations of companies were evidence of sustained growth in investment activity. The further increase in personal income fueled consumer demand. Overall, real GDP growth in Q2, 2018 is estimated at 3.2% year-on-year,” reads a report on the central bank’s website.
The steady rise in consumer demand was propelled by stronger household income (wages, pensions, remittances). The latter supported the high growth rates of retail turnover, the NBU said.
“As in Q1, the disruption of ties with the non-controlled territories last year had an impact on the pace of economic growth. As a result, gross value added in the metallurgy, mining industry, and energy sector kept growing despite being held back somewhat by repairs at several large enterprises of the mining industry and metallurgy,” the report says.
As reported, a week earlier the National Bank confirmed the forecast for Ukraine’s GDP growth in 2018 and 2020 at 3.4% and 2.9% respectively, but worsened expectations for 2019 from 2.9% to 2.5%.
In the inflation report, the NBU also confirmed the inflation forecast for the current year at 8.9%, but improved the forecast for underlying inflation to 7.1%.
The growth of Ukraine’s economy in 2017 accelerated to 2.5% from 2.3% a year earlier with the increase in inflation to 13.7% from 12.4%.
The assets of the National Bank of Ukraine (NBU) as of July 1, 2018, amounted to UAH 942.724 billion, which was 8.2% less than at the beginning of the year.
Such financial indicators were published by the central bank in the parliamentary edition Holos Ukrayiny (the Voice of Ukraine) on Friday, July 20.
The amount of non-resident securities, which are part of the NBU’s assets, shrank most noticeably: by 10.1%, to UAH 372.725 billion, while holdings and special drawing rights (SDR) decreased by about 61%, to UAH 23.807 billion.
At the same time, the amount of funds and deposits in foreign currency and banking metals almost doubled, to UAH 49.806 billion.
In the structure of the NBU’s liabilities, the amount of obligations to transfer profits to the budget, fell by 85.2%, to UAH 6.614 billion, the amount of assets of government and other institutions fell by over 54.7%, to UAH 25.135 billion, while the liabilities of the National Bank before the International Monetary Fund shrank by 12.4%, to UAH 180.660 billion.
The National Bank of Ukraine (NBU) is technically ready to issue the electronic hryvnia, although the central bank continues studying the expediency of issuing it, head of the financial sector reform department at the NBU Yevhen Stepaniuk has said. “A pilot project on the technical issue of the electronic monetary unit of Ukraine has been launched. From the technical point of view, there is a high level of readiness, but from the point of view of the expediency of issuing and going beyond the pilot’s limits, this issue is still being studied,” he said at a roundtable at the NBU on Thursday.
As reported, at the end of 2016, the NBU launched a research project on the possible introduction of e-hryvnia – the national currency based on blockchain technology.
According to the regulator, e-hryvnia can allow minimizing transaction costs for transferring money from one player in the payment market of Ukraine to another and simultaneously to conduct them with almost instantaneous speed.
The National Bank of Ukraine (NBU) has approved the acquisition of 51% of shares in public joint-stock company Bank Lviv by Switzerland’s responsAbility Participations AG, the asset management company. The NBU said on its website that the decision was made on June 23.
Bank Lviv earlier reported that the package of documents to approve the acquisition by the new strategic investor was submitted on September 12, 2017.
Bank Lviv was registered in 1991. Its ultimate beneficiary holding over 99.9% of shares was citizen of Iceland Margeir Petursson.
The bank ranked 44th among 84 operating banks in terms of assets as of January 1, 2018 (UAH 1.938 billion), according to the NBU.
According to a posting on the website of responsAbility Participations, 60% of its shares belong to Swiss financial institutions, including Baumann&Cie, Raiffeisen Switzerland, Swiss Re Foundation, Vontobel Beteiligungen, 21% – to private investors and 19% – to managers and employees.
The core business of responsAbility Participations is investment in developing markets.
The National Bank of Ukraine (NBU) has changed the form of a report on risk management in the financial monitoring sphere, which would allow better assessing the risk management systems created by banks. According to a report on the NBU’s website, the new form of the report is outlined in NBU resolution No. 59 dated June 5, 2018, which amends the rules of organizing and holding inspections to prevent and combat money laundering, financing of terrorism, and the financing of proliferation of weapons of mass destruction approved by NBU resolution No. 197 dated June 20, 2011.
The new version of the resolution also changed the frequency of submitting the reports on risk management in the field of financial monitoring – henceforth it will be provided by a bank to the NBU annually, rather than quarterly.
In addition, the NBU introduced a new procedure in case of detection of schemes for conducting risky financial transactions during the on-site inspection, the conclusion on compliance or non-compliance of which with the requirements of the law cannot be presented in the report on the field inspection (without additional consultations). Henceforth, the report would contain details of the essence of the financial transactions revealed with a detailed statement of the relevant facts. The copies of documents certifying these facts are attached to the verification materials.
In the future, the verification of the revealed facts will be continued without interruption.