KIEV (Reuters) – Ukraine’s president wants a settlement with the former owner of PrivatBank, Prime Minister Oleksiy Honcharuk told a newspaper, potentially derailing the IMF-backed nationalization of the country’s largest bank.
FILE PHOTO: Ukrainian President Volodymyr Zelenskiy delivers a speech during the Yalta European Strategy (YES) annual meeting in Kiev, Ukraine September 13, 2019. Ukrainian Presidential Press Service/Handout via REUTERS The remarks published in the Financial Times on Tuesday followed Friday’s statement by PrivatBank’s former owner Ihor Kolomoisky saying there was room for an amicable solution now Volodymyr Zelenskiy was president.
PrivatBank was nationalized against Kolomoisky’s wishes in December 2016 and its fortunes are closely watched by investors because the International Monetary Fund may freeze aid to Ukraine if the nationalization were to be reversed.
The statements by Kolomoisky and Honcharuk could sound alarm bells just as an IMF mission is in town to discuss a new aid-for-reforms deal with Honcharuk’s government, which took charge following a snap July election.
As part of an IMF-supported clean-up of Ukraine’s financial system, the authorities nationalized PrivatBank in 2016 saying the lender had a $5.6 billion hole in its balance sheet due to shady lending practices. Kolomoisky disputed this assessment.
“I’m completely convinced that we need to concentrate on growth now and look for joint solutions instead of spending our resources on destroying each other,” the prime minister said.
“So I am very positive about any rhetoric directed towards searching for a compromise,” he told the Financial Times.
Honcharuk, his office and the International Monetary Fund did not immediately respond to requests for comment.
Zelenskiy, a former comedian and actor, entered politics as a political novice this year promising to tackle corruption. He beat incumbent President Petro Poroshenko in April.
Zelenskiy’s relationship with Kolomoisky has been under intense scrutiny. The two have longstanding business ties and Kolomoisky’s 1+1 TV channel was the springboard for Zelenskiy’s presidential election campaign.
The president has repeatedly denied suggestions he would help Kolomoisky win back PrivatBank or help Kolomoisky win compensation. The two men met publicly last week but Kolomoisky told reporters that PrivatBank was not discussed.
Writing by Matthias Williams; Editing by Louise Heavens and Edmund Blair
LINK ORIGINAL: Reuters