The fall of the Ukrainian economy in 2022 will be about 33% according to the baseline scenario, in which the war will last for another month and a half at the most, Alexander Pecheritsyn, a leading analyst at Raiffeisen Bank (Kyiv), said.
“If the war lasts until the end of the year, then (GDP) could fall as much as 45%,” he said at a zoom conference on Tuesday.
Pecheritsyn specified that this is the bank’s third forecast since the beginning of the war. According to him, the initial decline in the economy was estimated at about 15% based on previous fast-moving conflicts in the world, for example, in Georgia. Then, in March, the bank estimated a decline as low as 24%, taking into account the gross regional product and the map of hostilities. In particular, as part of this analysis, a 34% decrease in this year’s crop is expected.
Serhiy Kolodiy, Chief Manager for Macroeconomic Analysis at Raiffeisen Bank, recalled that in 2014-2015, the fall in GDP was approximately 25% compared with pre-war Ukraine (in official statistics, data are compared only for controlled territories).
Pecheritsyn added that in terms of GDP, the bank estimates a 39% drop in private consumption due to the emigration of 15% of the population, lower incomes and negative consumer expectations.
According to him, domestic investment, which is the most vulnerable component, will fall by half this year under the baseline scenario.
“On the positive side, production relocation programs have little effect, but on the scale of the total output, of course, it is small,” the analyst said.
Speaking about inflation, Pecheritsyn noted that the bank still maintains its forecast for this year at 17% after 10% in the past. He explained that the volume of purchases by the National Bank of military bonds in the amount of UAH 60 billion is still within the limits of controllable, in addition, state control over prices and the freezing of utility tariffs affect.
In general, speaking about the work of analysts during the war, Pecheritsyn said that the bank began issuing weekly military reviews.
“War is a new challenge, we are no strangers to them, since there was a coronavirus two years ago. But the current (challenge) is much more difficult,” he stressed.
Pecheritsyn until February of this year served as chief economist at Credit Agricole Bank (Kyiv).
As reported, according to the World Bank, which before the war expected the Ukrainian economy to grow by 3.2% this year, it will fall by 45.1%. According to his report from early April, in 2023 the Ukrainian economy is expected to recover by only 2.1%, which is also worse than previous expectations of 3.5%.
The National Bank of Ukraine predicts a decline in the country’s GDP this year by at least a third, refusing to make more detailed estimates. The IMF expects a 35% decline.
Raiffeisen Bank (Kyiv) and Raiffeisen Bank Zrt have launched the possibility of exchanging hryvnia cash in Hungary since March 31, the bank’s press service said on Thursday.
“From March 31, Ukrainians who are in Hungary can exchange their cash in hryvnia within the Exclusive Group partner currency exchange offices, ” the message says.
The press service noted that now there is a limit of UAH 10,000 for the exchange of cash hryvnia by one person per day.
Raiffeisen Bank Aval (Kyiv) from June 17 changed its name to Raiffeisen Bank with the changes in the charter and public register, the bank’s press service said on Thursday.
“The name of the bank should be simpler, like everything for our clients: our products and services should be simple. We continue transforming, this is part of our strategy. Moving towards simplicity, we emphasize our belonging to a powerful international financial group,” the press service said, citing Board Chairman Oleksandr Pysaruk.
Raiffeisen Bank continues honoring its commitments to customers as the successor of Raiffeisen Bank Aval.
The bank said that in connection with the renaming, there is no need to contact branches, reissue cards or reissue documents.
Raiffeisen Bank Aval was founded in 1992. As of March 1, 2021, its largest shareholders were Raiffeisen Bank International with 68.27% of shares and the European Bank for Reconstruction and Development (EBRD) with 30%. Another 1.19% of the shares belonged to other legal entities and 0.54% to individuals.
According to the National Bank of Ukraine (NBU), as of March 1, 2021, Raiffeisen Bank Aval ranked fifth in terms of total assets (UAH 118.336 billion) among 73 operating banks.
The net profit of Raiffeisen Bank Aval JSC (Kyiv) in January-March 2021 amounted to UAH 1.087 billion, which is 4.9% more than in the same period of 2020 (UAH 1.037 billion).
According to a report on the website of the financial institution, in the first quarter of 2021, the bank’s net interest income amounted to UAH 1.81 billion, net commissions reached UAH 561.39 million, which is 2.7% and 10.3% less than in January-March 2020, respectively.
The bank’s assets in the first three months grew by 1.5%, to UAH 108.86 billion, including a 1.4-fold rise in cash and cash equivalents, to UAH 22.38 billion, and a 3.7% increase in loans to customers, to UAH 47.41 billion.
The bank’s liabilities grew by 0.5%, to UAH 94.9 billion, including a rise of 3.5% in liabilities to customers, to UAH 91.3 billion.
The bank’s equity capital grew by 8.2%, to UAH 13.95 billion, while the charter capital remained unchanged (UAH 6.16 billion).
Raiffeisen Bank Aval was founded in 1992. As of January 1, 2021, its largest shareholders were Raiffeisen Bank International with 68.27% of shares and the European Bank for Reconstruction and Development (EBRD) with 30%.
According to the NBU, as of March 1, 2021, Raiffeisen Bank Aval ranked fifth in terms of total assets (UAH 118.336 billion) among 73 operating banks
Raiffeisen Bank Aval (Kyiv) plans to send UAH 4.274 billion (90% of profit) to pay dividends to holders of ordinary shares based on the results of the financial institution’s work in 2019, while in the past year it accrued UAH 3.561 billion, and a year earlier UAH 4.244 billion.
According to the bank’s report in the information disclosure system of the National Securities and Stock Market Commission, the relevant issue was included in the agenda of a general remote meeting of shareholders scheduled for September 11.
It is indicated that out of UAH 4.749 billion of net profit for 2019, the bank plans to send UAH 700,000 (0.01%) to pay dividends to holders of preferred shares and UAH 474.1 million (9.98%) to the reserve fund.
Dividends, if approved, will amount to 6.95 kopecks per share, while at present they are quoted on the Ukrainian Exchange at the following rate: purchase at 35.36 kopecks, sale at 35.5 kopecks.
According to the agenda, the shareholders will also consider the appointment of Lukasz Januszewski as head of the supervisory board of Raiffeisen Bank International (RBI), responsible for investment banking and trade, instead of Martin Grull, and Thomas Matejka as a member of the supervisory board instead of Harald Kroeger.
Raiffeisen Bank Aval (Kyiv) does not plan to reduce office space in 2020, said Alexander Pisaruk, Board Chairman of the bank Oleksandr Pysaruk has said.
“In the medium term, I see an opportunity to reduce office space for a number of reasons, but probably not this year,” he said in an interview with Interfax-Ukraine.
According to Pysaruk, the reduction in office space will depend on the pace of the spread of coronavirus disease (COVID-19), morbidity, and also the acceleration of the digitalization trend.
At the same time, the board chairman spoke about the bank’s plans for redevelopment of offices in accordance with the social distancing rules during lockdown.
“As for the office space, it needs to be redesigned. The combination of presence of a smaller number of employees in the office with larger distances between workstations requires a systematic review of approaches to managing office real estate, including the interior, the number and quality of sites,” Pysaruk said.
