Kiev Court Cancels Kolomoyskyi's Personal Guarantee For PrivatBank's Loans - National Bank

Umer Jamshaid Published April 21, 2019 | 04:05 AM

KIEV (UrduPoint News / Sputnik - 21st April, 2019) The Pechersky District Court in Kiev has ruled to denounce the agreement on Ukrainian businessman Ihor Kolomoyskyi's personal guarantee for refinancing loans that the country's PrivatBank has obtained before being nationalized, the National Bank of Ukraine (NBU) said, pledging to appeal this decision.

The Kiev District Administrative Court declared on Thursday illegal the 2016 nationalization of the PrivatBank, of which Kolomoyskyi had been a founder, and ruled to invalidate the contract for the bank's shares sales. The NBU has expressed intention to appeal the ruling.

"The National Bank is appalled by the decision of the Pechersky District Court in Kiev, made on April 20, to cancel the agreement on Ihor Kolomoyskyi's personal guarantee for refinancing loans that the PrivatBank has obtained before the state acquired shares in its capital," the NBU wrote on Facebook late on Saturday.

The NBU said that it intended to appeal the ruling.

"Today's court ruling in favor of Ihor Kolomoyskiy has not taken legal effect yer and will certainly be appealed," Viktor Hryhorchuk, the head of litigation at the NBU Legal Department, said, as quoted by the NBU.

According to the NBU, Kolomoyskiy signed back in 2015 with the NBU the agreement on personal guarantee for five refinancing loans that PrivatBank obtained in 2008-2014. He has, thus, effectively pledged to pay the bank's debt, which currently amounts to 9.2 million hryvnias ($342,111). The NBU claimed that Kolomoyskiy had expressed unwillingness to pay the PrivatBank's debts and had therefore asked the court in 2017 to cancel the agreement.

The Ukrainian government nationalized PrivatBank, which then held around one-third of all deposits in the country, in late 2016, referring to the need to protect its customers and avert a meltdown of the Ukrainian economy.

Ukrainian President Petro Poroshenko has said that Ukraine risked default if the nationalization of PrivatBank was overturned.