UKRAINE BUSINESS NEWS - TEN ARTICLES
US Amb John Tefft; IFC/Raiffeisen; SigmaBleyzer; Ukraine Banks: In Receivership, Bust or Supported; Russians Circle Large Ukraine Business Group
INDEX OF ARTICLES ------
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1. U.S. AMBASSADOR JOHN TEFFT ON U.S.-UKRAINE RELATIONS
Op-Ed by John F. Tefft, United States Ambassador to Ukraine
Dzerkalo Tyzhnia, Zerkalo Nedeli, Mirror Weekly #48 (776), in Ukrainian & Russian
Kyiv, Ukraine, Saturday, December 12-18, 2009
U.S.-Ukraine Business Council (USUBC), in English, Wash, D.C., Wed, Jan 6, 2010
2. IFC TO LEND RAIFFEISEN'S UKRAINIAN UNIT VAT AVAL $105 MILLION
Raiffeisen owns the largest international lender in Ukraine
By Daryna Krasnolutska, Bloomberg, Kiev, Ukraine, Fri, Dec 25, 2009
3. VOLODYMYR LAVRENCHUK, CEO OF RAIFFEISEN BANK AVAL, AGAIN RECOGNIZED AT BEST TOP MANAGER IN UKRAINE'S BANKING SECTOR
The Financial, Tbilisi, Georgia, Kyiv, Ukraine, Wed, Dec 30, 2009
4. MICHAEL BLEYZER NAMED TO TEXAS EMERGING TECHNOLOGY FUND ADVISORY COMMITTEE
Houston Business Journal, Houston, Texas, Monday, Dec 21, 2009
5. GERMAN HENKELL&SOHNLEIN TO START COGNAC PRODUCTION IN UKRAINE
Eugene Vorotnikov, FoodBizDaily.com, Moscow, Russia, Tue, Jan 5, 2010
6. KEY INVESTMENT OPPORTUNITIES IDENTIFIED AT 'UKRAINE"
OPPORTUNITIES AND CHALLENGES' CONFERENCE IN NEW YORK
Hosted By the Foundation for Effective Governance and Financial Times
Foundation for Effective Governance (FEG), PRNewswire
New York, New York, Thursday, December 10, 2009
7. UKRAINE BANKS IN RECEIVERSHIP, BUST OR SUPPORTED
Factbox, Reuters, Kiev, Ukraine, Tuesday January 05, 2010
8. KYIV MAY TURN ZHULIANY INTO CITY'S SECOND INTERNATIONAL AIRPORT
Ukraine Business Online (UBO)/Ukrainian News, Kyiv, Ukraine, Mon, Dec 28, 2009
9. RUSSIAN GOVERNMNET TRIES TO HIDE ITS TAKEOVER OF UKRAINE'S INDUSTRIAL UNION OF DONBAS (IUD) TO AVOID AFFECTING THE PRESIDENTIAL ELECTION
Ukraine Business Online (UBO), Kyiv, Ukraine, Tue, 05 January 2010
10. RUSSIANS CIRCLE LARGE UKRAINE BUSINESS GROUP
By Roman Olearchyk in Kiev and Catherine Belton in Moscow
Financial Times, London, UK, Wed, January 6 2010
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1. U.S. AMBASSADOR TEFFT ON U.S.-UKRAINE RELATIONS
Op-Ed by John F. Tefft, United States Ambassador to Ukraine
Dzerkalo Tyzhnia, Zerkalo Nedeli, Mirror Weekly #48 (776), in Ukrainian & Russian
Kyiv, Ukraine, Saturday, December 12-18, 2009
U.S.-Ukraine Business Council (USUBC), in English, Wash, D.C., Wed, Jan 6, 2010
It is a great honor for me to take up my new duties as the United States Ambassador to Ukraine. This is an important time for Ukraine and for our bilateral relationship. A strong relationship with a sovereign and independent Ukraine has been a major priority for the United States since the collapse of the Soviet Union. It remains so today.
Secretary Hilary Clinton restated our commitment after her December 9 meeting with Foreign Minister Petro Poroshenko at the State Department when she said: “A strong and independent Ukraine is good for the region and good for the world.” We see the success of Ukraine in the post-Cold War world as a key to building a Europe whole, free and at peace.
During his visit to Washington, Foreign Minister Poroshenko launched with Secretary Clinton the new US-Ukraine Strategic Partnership Commission. This Commission, created during the visit of Vice President Biden last July, focused on a wide range of issues from foreign policy to energy, non-proliferation, democracy, rule of law and people-to-people exchanges. We will continue to work through this Commission to build our strategic partnership.
It is a prime, concrete example of what we mean when we say that, as we seek to reset our relationship with Russia, we remain steadfastly committed to Ukrainian independence and improving our broad partnership. The road Ukraine has followed since 1991 has not been smooth. I know that all Ukrainians would agree that much still remains to be done.
As you know, President Obama and his team are determined to improve U.S. relations with Russia, but not to the detriment of our relations with Ukraine. Vice President Biden said during his visit here in July, “As we reset the relationship with Russia, we reaffirm our commitment to an independent Ukraine.”
I arrive in Ukraine as President Obama’s envoy with 38 years of experience in the U.S. State Department. I have had the honor of serving as U.S. Ambassador in Georgia and Ambassador to Lithuania before that, as well as spending almost a year as acting Chief of Mission in Moscow.
I am not new to Ukrainian issues. During a posting to Washington, I vividly remember working late nights in 1992, preparing for the first-ever visit by the Foreign Minister of an independent Ukraine.
I later served as the chief U.S. diplomat in Washington directly responsible for policy issues related to Ukraine, Russia, Moldova, and Belarus. I consider myself lucky to have the opportunity now to work on bilateral U.S.-Ukrainian relations once again, this time as President Obama’s envoy to this great county.
Ukraine over the past century has withstood war, division, revolution and tragedy. Indeed, just recently the people of this country memorialized the millions of its citizens – men, women and children – who died during the Holodomor.
But, as President Obama noted recently, “The Ukrainian people overcame the horror of the great famine and have gone on to build a free and democratic country.” I too was deeply moved when I visited the Holodomor Memorial on Monday, immediately after my initial meeting with President Yushchenko.
In the sphere of international relations, Ukrainian peacekeepers have served with distinction in recent years in a number of dangerous assignments, including the Former Republic of Yugoslavia and Sierra Leone. As you might be aware, President Obama has just outlined a strategy for our efforts in Afghanistan.
We welcome Ukraine’s recent decision to increase the number of Ukrainian personnel serving in western Afghanistan from 10 to 30. We also honor the memories of the six Ukrainian service members who perished in a helicopter crash in Afghanistan in July of this year, as well as the 18 who gave their lives while serving in Iraq from 2003 to 2005.
I would add that, as I mentioned during my confirmation hearings before the U.S. Senate, sovereign Ukraine took a courageous step in ridding itself of the nuclear weapons it inherited after the fall of the Soviet system. In light of the international threat posed by the nuclear programs of Iran and North Korea, and mindful of the upcoming review of the Nuclear Non-Proliferation Treaty, Ukraine shines as an example for others to follow.
On the home front, Ukraine can count many blessings, including its rich agricultural tradition, an abundance of natural resources, and a well-educated population. With our friends in the EU, we are eager to help Ukraine develop to its maximum economic potentials.
Modernization and change are needed in the gas and oil sector to provide Ukraine with real energy security and reliable access to sources of fuel. Much work remains to be done to improve living standards and achieve sustained growth as the health of the global economy improves.
The U.S. Government has provided over $90 million in our various assistance programs this year, focusing on improving health, promoting economic growth, bolstering peace and stability, and promoting good governance and the rule of law.
We are joining forces with our Ukrainian allies and other nations and international organizations to combat common scourges including HIV/AIDS and human trafficking, as well as to raise awareness of climate change and other environmental issues.
Our team in the U.S. Embassy is committed to working with and helping Ukraine, even as we all try to weather the current economic troubles. That will obviously require tough budget decisions by Ukraine’s leaders, a firm commitment to economic reform, and a willingness to combat corruption at all levels and in all spheres of life. As Vice President Biden noted during his visit, Ukraine’s leaders must work together to bring about needed political and economic reforms.
The United States will closely monitor the upcoming Presidential election in Ukraine. As Secretary Clinton said on December 9th, “It is for the Ukrainian people to decide who their elected leaders should be. We will work with whomever the Ukrainian people elect in a fair and free election.” More broadly, the United States will continue to support the further development of effective governance, the free exchange of information and a vibrant civil society.
This is an extraordinarily difficult time in Ukraine’s history. This country finds itself at an important crossroads. Great challenges remain for your society and your government. But you should know that America stands ready to assist you, as a partner and friend.
LINK UKR: http://www.dt.ua/1000/1550/68033/
LINK RUS: http://www.zn.ua/1000/1550/68033/
FOOTNOTE: The Op-Ed by U.S. Ambassador John F. Tefft was originally published by Dzerkalo Tyzhnia, Zerkalo Nedeli, Mirror Weekly #48 (776), in Ukrainian and Russian. The English version was obtained by the U.S.-Ukraine Business Council (USUBC), Washington, D.C., www.usubc.org, directly from the U.S. Embassy in Kyiv.
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2. IFC TO LEND RAIFFEISEN'S UKRAINIAN UNIT VAT AVAL $105 MILLION
Raiffeisen owns the largest international lender in Ukraine
By Daryna Krasnolutska, Bloomberg, Kiev, Ukraine, Fri, Dec 25, 2009
KIEV - International Finance Corp., a member of the World Bank Group, agreed to lend $105 million to Raiffeisen International Bank’s Ukrainian unit VAT Aval to strengthen the lender’s capital.
The Washington-based IFC’s board of governors approved the 10-year subordinated loan last week, Elena Voloshina, the institution’s Ukraine representative, said in an interview in Kiev late yesterday. The two sides will sign the accord in January, she added. “Aval is a big, systemic bank in Ukraine,” Voloshina said. “We’re not limiting the bank on how it spends the loan.”
Ukraine’s banking system was hit by the global financial crisis, which weakened the currency and dried up investment. About 20 lenders are relying on state aid to remain afloat, with the country’s financial plight contributing to an annual 15.9 percent economic contraction last quarter.
OWNS LARGEST INTERNATIONAL LENDER IN UKRAINE
Raiffeisen owns the biggest foreign lender in Ukraine, where it has reported losses in the last four quarters. The company announced a 10 percent reduction in its 18,300-strong workforce in the country in February and plans further job reductions, Chief Financial Officer Martin Gruell said on Nov. 30. Ukraine is the Vienna-based bank’s “sore spot,” he said.
IFC plans to invest $500 million in Ukraine this financial year, which started on July 1. So far, the institution has disbursed $40 million to Ukrainian state-owned Export-Import Bank, $20 million to VAT Megabank and $20 million to OTP Bank Nyrt.’s Ukrainian unit, said Voloshina.
Nonperforming Loans
“The rest we will probably invest in the financial sector and agriculture in the next six months. We are now in talks,” she said, declining to elaborate.
Ukrainian nonperforming loans account for about 20 percent of total loans and may rise as high as 30 percent by the middle of next year if the economic outlook doesn’t improve, Moody’s Investors Service said on Nov. 30.
“Next year, nonperforming loans will be structured differently,” said Voloshina. “2010 will be the year of corporate non-performing loans.” The IFC also consults with banks on how to handle nonperforming loans, she said.
The IFC also plans to begin guaranteeing loans in a bid to make cheaper credit from other sources available to Ukrainian companies and banks in the first half of next year, she said.
To contact the reporter on this story: Daryna Krasnolutska in Kiev at dkrasnolutsk@bloomberg.net.
LINK: http://www.bloomberg.com/apps/news?pid=newsarchive&sid=a2h9RGPicRp8
FOOTNOTE: RZB Finance, a U.S. company wholly owed by the Raiffeisen International Bank, is a member of the U.S.-Ukraine Business Council (USUBC), Washington, D.C., www.usubc.org.
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3. VOLODYMYR LAVRENCHUK, CEO OF RAIFFEISEN BANK AVAL, AGAIN
RECOGNIZED AT BEST TOP MANAGER IN UKRAINE'S BANKING SECTOR
The Financial, Tbilisi, Georgia, Kyiv, Ukraine, Wednesday, December 30, 2009
KYIV - For the second year running, Volodymyr Lavrenchuk, CEO of Raiffeisen Bank Aval, has been named Best Top Manager in the Banking Sector of Ukraine within the all-Ukrainian Guard of Managers 2009 rating.
By results of the year 2009, the top manager of Raiffeisen Bank Aval was also named among three best managers in thirty branches of the economy of Ukraine .
The Guard of Managers 2009 rating named 300 most successful top managers of Ukraine , who succeeded to lead their companies through crisis trials and deserved positive assessments from their colleagues.
While making the rating, the expert board took into consideration management efficiency of companies, their competitiveness, quality of relations with partners, social activity as well as business reputation of their top managers. Besides, a number of resulting assessments in questionnaires of the rating experts as well as competitors’ evaluations on each kind of activities were also taken into account.
The rating Guard of Managers 2009 was initiated by the Ukrainian Rating Agency and published by the Halytski Kontrakty publishing house. The aim of the rating is to receive an objective independent assessment of a professional level of Ukrainian top managers.
Projects titled Guard have been launched since May 2004. Results of the ratings are subjected to external audit.
LINK: http://finchannel.com/news_flash/Banks/55250_Volodymyr_ Lavrenchuk_Again_Recognized_as_Best_Top_ Manager_in_Ukraine%E2%80%99s_Banking_Sector/
FOOTNOTE: RZB Finance, a U.S. company wholly owed by the Raiffeisen International Bank, is a member of the U.S.-Ukraine Business Council (USUBC), Washington, D.C., www.usubc.org. Volodymyr Lavrenchuk, CEO of Raiffeisen Bank Aval, has attended several USUBC meetings held in Kyiv.
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4. MICHAEL BLEYZER NAMED TO TEXAS EMERGING
TECHNOLOGY FUND ADVISORY COMMITTEE
Houston Business Journal, Houston, Texas, Mon, Dec 21, 2009
HOUSTON - Michael Bleyzer has been appointed by Texas Governor Rick Perry to a two-year term on the Texas Emerging Technology Fund Advisory Committee.
Bleyzer is president and chief executive officer of Houston based private equity firm SigmaBleyzer Investment Group LLC, which has made numerous investments in European and U.S. industrial firms [including Ukraine, Romania and Kazakhstan].
The Committee recommends proposals eligible for funding under the emerging technology fund. Bleyzer’s term expires Aug. 31, 2011.
LINK: http://houston.bizjournals.com/houston/stories/2009/ 12/12/daily15.html
FOOTNOTE: SigmaBleyzer Investment Group LLC is a member of the U.S.-Ukraine Business Council (USUBC), Washington, D.C., www.usubc.com.
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Promoting U.S.-Ukraine business relations & investment since 1995.
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5. GERMAN HENKELL&SOHNLEIN TO START COGNAC PRODUCTION IN UKRAINE
Eugene Vorotnikov, FoodBizDaily.com, Moscow, Russia, Jan 5, 2010
MOSCOW - German Henkell&Sohnlein Sektkellereien, one of the world’s largest wine producers which owns the Kyiv Stolychny factory of sparkling wines, is planning to start bottling cognac under its own brand at the Simferopol cognac plant in 2010, according to Valeriy Romansky, the executive director of Stolychny factory.
"We want to launch production of cognac under our own brand. We have defined producers who will realize the project," Romansky said.
Yuriy Naumchuk, the deputy director on sales and marketing, said that the company plans to start the sale of cognac under its own brand from April 2010.
The product will be considered as that of the middle price segment.
Romansky said that in spite of crisis, Henkell&Sohnlein is still interested in the purchase of Ukrainian companies, including cognac enterprises."We are most interested in Crimean producers," he said.
Earlier Henkell&Sohnlein Sektkellereien said it was in talks on the purchase of another Ukrainian enterprise located in Crimea. Stolychny has been producing champagne since 1954. In October 2007 Henkell&Sohnlein Sektkellereien acquired a stake of over 75% in Stolychny. In 2008, the share of Stolychny on the Ukrainian market of sparkling wines was 20%.
LINK: http://foodbizdaily.com/articles/95465-german-henkellsohnlein-to-start-cognac-production-in-ukraine.aspx
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6. KEY INVESTMENT OPPORTUNITIES IDENTIFIED AT 'UKRAINE" OPPORTUNITIES AND CHALLENGES' CONFERENCE IN NEW YORK
Hosted By the Foundation for Effective Governance and Financial Times
Foundation for Effective Governance (FEG), PRNewswire
New York, New York, Thursday, December 10, 2009
NEW YORK - A number of key investment opportunities were presented at "Ukraine: Opportunities and Challenges," a conference focusing on the country's economic outlook, hosted by the Foundation for Effective Governance (FEG) and Financial Times. The event, held on Tuesday at the Four Seasons Hotel in Manhattan, also addressed Ukraine's evolving business environment, and the challenges that need to be overcome for investment opportunities to be realized there.
"This unique event focused on the Ukrainian economic agenda, which is not only about the challenges Ukraine currently faces, but also about opportunities for growth and development. This conference addressed a number of important issues for Ukraine, including the question: is it reasonable to focus on long-term solutions in the current political and economic environment in Ukraine?
"If we continue to follow short-term goals and address only situational political issues, the country will never be able to move forward," stated Nataliya Izosimova, Managing Director of the Foundation for Effective Governance. "In all the projects that the Foundation is running, we are trying to maintain a balance between strategy and tactics, with short-term and longer-term perspectives being always practical and end result oriented".
Chaired by Chrystia Freeland, the Financial Times' U.S. Managing Editor, the conference featured a keynote address by William Taylor, former U.S. Ambassador to Ukraine, along with contributions from the Right Honourable Kim Campbell, Chair of FEG's International Advisory Board and former Prime Minister of Canada, and many leading experts on the country including Ralph Judah, Senior Partner, Monitor Group and Elena Kuznetsova, Senior Manager, McKinsey & Company.
Panelists included Georgina Baker, IFC's Director for Global Financial Markets; Vladislav Kaskiv, Advisor to the Prime Minister of Ukraine on Foreign Investment, Parliament of Ukraine; Irina Akimova, Deputy Chair of the Parliamentary Committee of Economic policy, Parliament of Ukraine; Boris Kolesnikov, Member of the Parliamentary Committee of Economic policy, Parliament of Ukraine; Vitaliy Butenko, Chief Strategy Officer, DTEK, a leading Ukrainian energy company; Andriy Sadovvy, Mayor of Lviv, a key city in Western Ukraine; Andrew Swart, Partner, Monitor Group; and others.
Ms. Baker, who also participated in the panel on Ukraine's business environment, stated: "IFC is committed to actively helping Ukraine's economy recover from the global financial crisis, and we hope our investments will help bring other private investors in as well. We are working now on assisting banks in Ukraine to renew their lending, giving a boost to the domestic economy."
Ms. Akimova, a third participant in the panel on Ukraine's business environment, stated: "The worsening of the business climate in Ukraine over the last two years is a result of non-transparent and incoherent economic policies pursued by the government. A large fiscal gap has been accompanied by an increased pressure on business, favoritism, and corruption. Economic freedom must be based on rule of law and strong institutions, which protect businesses from discretionary government intervention. We have to implement a good business climate including security of property rights, a level playing field, low corruption, stable and business-friendly taxes and regulations."
Mr. Swart, a participant in a panel on regional opportunities, stated: "The Ukrainian regions are at a pivotal point in their future development. The Foundation for Effective Governance's projects together with Monitor Group, in Lviv and Donetsk, have created strong support amongst business and government stakeholders to unwind the legacy issues of the past and create the conditions for long term competitiveness. While there are challenges ahead, there are many opportunities for businesses seeking to take advantage of the projected growth."
Mr. Sadovvy, a participant in a panel discussion on sector opportunities, identified tourism development as an engine of economic growth in Lviv. The tourism cluster together with business services have been selected as development priorities in the strategy resulting from a regional economic development project, implemented by FEG in close cooperation with the local government and businesses.
"Lviv can become one of the most comfortable and attractive cities in Europe to reside and work in. We are making every effort to fulfill this ambition. Lviv has a number of advantages including its cultural significance and proximity to Europe, as well as a highly educated and talented labor pool. The city administration is strongly committed to providing investors with administrative support, local tax incentives, transparent and business-friendly regulations, and consulting," Sadovvy stated.
All three panel discussions offered insight into possible investment strategies within the wider economic and political context. Topics included:
(1) How bright is the outlook for Ukraine as it begins to emerge from the economic and financial crisis, and ahead of key presidential elections in 2010?
(2) What measures need to be taken to improve the business environment and create incentives for international companies to invest?
(3) Where are the most promising regional investment opportunities?
(4) Which established industrial and service sectors offer the best returns in the short, medium and long term? What are the most promising new opportunities for investment?
(5) What are the key challenges to be overcome for Ukraine to become a major destination for international investors?
Izosimova concluded: "Despite the unique nature of Ukraine as a country and a culture, it is a part of the global process. So, we are ready and willing to work with every institution or individual who shares our values and mission of helping Ukraine be a prosperous and stable country. I hope that today's forum is a useful tool in building more awareness about the real Ukraine, the real challenges it faces and real solutions it strives to find."
Attendees at the conference included U.S. and Ukrainian government officials and regulators, and senior representatives of multilateral institutions, Ukraine-based companies, multinationals, international banks, private equity firms, specialist funds, research groups, NGOs and media. More information is available at www.ftconferences.com/ukraine.
About The Foundation for Effective Governance: The Foundation for Effective Governance (FEG), an independent public policy institution, was formed in 2007 by Ukrainian businessman Rinat Akhmetov. FEG's main objective is to encourage the development of long-term national economic programs for Ukraine, through the formulation of practical policy solutions to the political, economic and social challenges facing the country.
The basic principles governing FEG's activities are independence, a focus on economic development, openness, and a practice-oriented approach. FEG's International Advisory Board includes former Prime Minister of Canada Kim Campbell, Chair; former U.S. Sen. Lincoln Chafee; and Gyorgy Suranyi, former president of the National Bank of Hungary. More information on FEG is available at www.feg.org.ua/en.
About the Financial Times: The Financial Times, one of the world's leading business news organisations, is recognised internationally for its authority, integrity and accuracy. Providing extensive news, comment and analysis, the newspaper is printed at 23 print sites across the globe, has a daily circulation of 412,854 (ABC figures, October 2009) and a readership of 1.3 million people worldwide.
FT.com is the definitive home for business intelligence on the web, providing an essential source of news, comment, data and analysis for the global business community. FT.com attracts 11.4 million unique users, generating 83.2 million page views (ABCe figures, March 2009) and now has over 1.6 million registered users.
SOURCE: Foundation for Effective Governance, Web Site: http://www.feg.org.ua/en
CONTACT: Joshua Greenwald, Rubenstein Public Relations, +1-212-843-8037, jgreenwald@rubensteinpr.com
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7. UKRAINE BANKS IN RECEIVERSHIP, BUST OR SUPPORTED
Factbox, Reuters, Kiev, Ukraine, Tuesday January 05, 2010
KIEV - Ukraine's central bank said on Tuesday it had liquidated the Ukrainian Financing Group -- a tiny commercial bank that is the seventh victim of the financial crisis that has gripped Ukraine for over a year.
The bank was 170th in assets out of over 180 operating in Ukraine. It had assets of 135 million hryvnias ($17 million).
The banking sector has been hit by a sharp depreciation of the currency -- 60 percent from a peak last year -- and a soaring number of non-performing loans as a deep economic recession hits companies and consumers alike.
The following is a list of banks placed in receivership, those allowed to go under, those helped by the government and also a list of the top foreign banks in
Ukraine.
Banks' assets data taken from the central bank are correct as of Oct. 1, 2009.
BANKS IN RECEIVERSHIP:
Name Size Assets Date
million hryvnias ------
[1] Nadra Bank * 11 25,893 10 Feb 08
[2] Ukrprombank * 18 10,223 21 Jan 09
[3] Rodovid 24 9,098 16 March 09
[4] Hypobank 65 1,473 2 Oct 09
[5] BIG Energya 75 1,135 16 March 09
[6] Zakhidinkombank 98 775 13 Feb 09
[7] Inprombank 105 660 11 Sept 09
[8] Volodymyrsky 136 352 17 July 09
[9] Transbank 143 301 2 March 09
[10] Dnistr 146 277 17 April 09
[11] Bank Stolitsa 154 207 20 July 09
[12] Dialogue Bank 158 189 16 Oct 09
[13] Arma 167 163 17 April 09
TOTAL ASSETS 890 billion hryvnias ($110 billion) - banks in receivership 51 billion hryvnias ($6.4 billion)
* Nadra and Ukrprombank are likely to be liquidated after the central bank transferred their deposits to freshly nationalised Rodovid Bank.
The central bank automatically freezes all withdrawals of deposits for six months when it places a bank in receivership.
BANKS GONE BUST:
Bank Size at the time
[1] European 53
[2] National Standard 70
[3] Vostochno-Evropeyskiy 81
[4] Regional Development Bank 94
[5] Odessa Bank 111
[6] Prichornomorya 144
[7] Ukrainian Financing Group 170
BANKS THE GOVERNMENT HAS NATIONALISED
Name Stake Size Assets Date; bought million hryvnias --------
[1] Ukrgazbank $420 million for 84.21 17 12,941 June 09
[2] Rodovid Bank $370 million for 99.97 24 9,098 June 09
[3] Bank Kyiv $470 million for 99.93 40 5,300 June 09
FOREIGN BANKS IN UKRAINE
Bank Parent Size Assets: million hryvnias ------
[1] Raiffeisen Bank Aval Raiffeisen 3 60,236
[2] Ukrsibbank BNP Paribas 5 48,454
[3] Ukrsotsbank UniCredit 6 44,273
[4] Alfa Bank Alfa Group 7 33,964
[5] Prominvestbank VEB Bank 8 30,803
[6] OTP Bank OTP 9 29,934
[7] VTB VTB 10 28,258
[8] Forum Commerzbank 12 18,645
[9] Swedbank Swedbank 16 13,735
[10] Erste Erste 20 11,238
[11] ING Ukraine ING 22 9,572
[12] Unicredit Bank UniCredit 23 9,240
[13] Pravex Bank Intesa SP 28 6,989
[14] Kredobank PKO BP 31 5,531
[15] Sberbank Sberbank 32 5,500
[16] Swedbank Invest Swedbank 34 5,386
[17] Calyon Credit Agricole35 4,950
[18] Citi Citigroup Inc 37 4,104
[19] SEB Bank SEB 44 3,663
(Compiled by Sabina Zawadzki; editing by Stephen Nisbet)
LINK: http://www.forexyard.com:80/en/reuters_inner.tpl?action=2010-01-05T112309Z_01_LDE6040Z1_RTRIDST_0_UKRAINE-BANKS-FACTBOX
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8. KYIV MAY TURN ZHULIANY INTO CITY'S SECOND INTERNATIONAL AIRPORT
Ukraine Business Online (UBO)/Ukrainian News, Kyiv, Ukraine, Mon, Dec 28, 2009
KYIV - With major construction to expand the capacities of Boryspil, Ukraine’s largest international airport, well underway, Kyiv is adding further capacity to deal with expanding business and tourist travel by approving construction of a new international terminal and reconstruction of the existing passenger terminal of the Kyiv Airport, commonly known as Zhuliany.
The city’s planning and architecture department said today that the project has been drawn up by the Bureau of Investment Projects - Project Management Company (BIP-PM) that would expand the gross area of the reconstructed terminal to 3,200 square meters. The total area of the new international terminal would be 12,000 square meters on two floors.
The construction footprint under the existing terminal is 0.34 hectare, and the construction footprint under the new terminal will be 0.61 hectare. The reconstructed terminal and the new terminal would each have a capacity of handling 320 passengers per hour.
BIP-PM has also drawn up a draft of the square near the airport, the parking facilities, and the complex development of the neighboring territory with the creation of a business center.
The draft envisages construction of hotel, commercial, office, and logistics infrastructure alongside entertainment facilities
The city planning council recommended that architects finalize the general plan of the new expanded passenger handling facilities and the infrastructure needed to handle additional aircraft traffic.
USUBC SEES ZHULIANY EXPANSION AS PART OF BROADER NEEDS
"It is a positive sign the city of Kyiv is looking ahead regarding business and tourist travel. However, it is important first to complete the ongoing construction at Boryspil, and second to be in close touch with those airlines serving Kyiv as to their future needs and take these into consideration. Then the third issue should be to consider what could be done practically and economically to expand the Zhuliany facility, said Morgan Williams, SigmaBleyzer, who serves as President of the U.S.-Ukraine Business Council (USUBC).
Williams also stated, "The government of Ukraine needs to make sure the aviation safety problems outlined by the Federal Aviation Administration (FAA) of the U.S. government, which have been stopping an increase in the number of non-stop flights between Ukraine and the United States since 2005, are resolved early in 2010. It is very important for international business and tourism travel for AeroSvit Ukrainian Airlines to increase the number of its non-stop flights to New York City and to be able to fly to Chicago, Los Angeles and Houston. This is not possible under the present restrictions imposed on Ukraine by the FAA."
LINK: http://www.ukrainebusiness.com.ua/news/648/Kyiv-to-turn-Zhuliany-into-citys-second-international-airport.html
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9. RUSSIAN GOVERNMENT TRIES TO HIDE ITS TAKEOVER
OF UKRAINE'S INDUSTRIAL UNION OF DONBAS (IUD) TO
AVOID AFFECTING THE PRESIDENTIAL ELECTION
Ukraine Business Online (UBO), Kyiv, Ukraine, Tue, 05 January 2010
DONETSK – The Industrial Union of Donbas (IUD), one of Ukraine’s largest industrial holdings has been bought by the Russian government in a thinly veiled deal being operated through the Russian government-owned bank, Vneshekonombank. Reports from sources believed to be reliable said that Prime Minister Vladimir Putin, who serves as chairman of Vneshekonombank’s supervisory board, has been hands-on in the deal.
The bank will pay $1 billion for the stakes of IUD’s Vitaly Gaiduk, Sergei Taruta and Oleg Mkrtchian, who hold 20 percent, 40 percent and 40 percent stakes in the company, respectively.
The reports say that IUD had no choice but to agree to the takeover bid since it had run up huge debts to Vneshekonombank and other foreign banks. The sale was said to be the only way that IUD could avoid bankruptcy.
Up to this point the deal had been kept secret since both the Russian and the Ukrainian principals believed that disclosure prior to Ukraine’s presidential election on January 17 might result in a negative reaction for the election chances of Viktor Yanukovych, generally regarded as the candidate Russian political leaders want to see win the Ukrainian presidency.
The deal will be considered worrisome not only in Kyiv but in other capitals since it effectively places the largest metallurgical works of Hungary, Poland and Ukraine in the hands of the Russian government. The properties now held by the Russian government through the thin veil of Vneshekonombank include Hungary’s Dunaferr in Dunaújváros, Poland’s Huta Czestochowa, as well as facilities formerly owned by the Industrial Union of Donbass at Dnipropetrovsk and Alchevsk.
The IUD takeover comes in the wake of the recent bankruptcy of Soyuz Viktan, one of the world’s largest vodka makers.
LINK: http://www.ukrainebusiness.com.ua/news/687/Russian-government-tries-to-hide-its-takeover-of-IUD-to-avoid-affecting-presidential-election.html
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10. RUSSIANS CIRCLE LARGE UKRAINE BUSINESS GROUP
By Roman Olearchyk in Kiev and Catherine Belton in Moscow
Financial Times, London, UK, Wed, January 6 2010
KIEV/MOSCOW - An unnamed Russian group is close to buying control of one of recession-hit Ukraine’s largest steel groups, in a deal that risks causing political controversy in Kiev in the run-up to this month’s presidential election.
The Financial Times has learnt that the debt-laden ISD Corporation, which has plants in Poland and Hungary as well as Ukraine, could be sold later this month in a transaction valuing the group up to $2bn (€1.4bn, £1.3bn) with Vnesheconombank, the Russian state bank, playing a role in the acquisition.
News of the deal could raise political tensions in Ukraine, where Yulia Tymoshenko, the prime minister, and Viktor Yanukovich, opposition leader, are both bidding to succeed the pro-west Viktor Yushchenko as president. Mr Yushchenko, who is fighting a losing battle to retain office, has repeatedly accused both Ms Tymoshenko and Mr Yanukovich of co-operating too closely with Moscow.
They deny the claims. But Mr Yushchenko has kept up the attack and on Sunday said: “Tymoshenko and Yanukovich are the finest representatives of a single Kremlin coalition.”
Analysts said the deal is also evidence of Russia’s bid to expand its industrial grip over former Soviet Union countries.
While Russian companies have invested heavily in Ukraine, mostly without controversy, the timing of the latest deal could prove difficult for Kiev’s politicians. Two creditors familiar with the situation at ISD, which has struggled to restructure more than $3bn in debts amid falling demand, said they were told by the group’s Ukrainian shareholders that the acquisition would close this month.
Vnesheconombank said on Tuesday it was only providing financing for the deal and not taking a stake.
The potential buyers include Alisher Usmanov, the mining magnate, and Evraz, a metals group in which billionaire Roman Abramovich has a stake. Both have in recent years expressed interest in ISD. Representatives of Mr Abramovich and Mr Usmanov were not immediately available for comment.
The creditors said they were told by ISD the Russian group would take a 50 per cent plus one share stake. Sergei Taruta, Ukrainian billionaire, and his partner, Oleg Mkrtchan, would each retain 25 per cent stakes. Their former partner, Vitali Gaiduk, an adviser to Ms Tymoshenko, would fulfil his ambition to exit the business.
Tomas Fiala, managing director of Dragon Capital, a Kiev-based investment bank, put ISD’s enterprise value, equity plus debt, at $4.3bn-$5.3bn.
That is far less than ISD’s owners had sought in previous years “For ISD, this was the best option on getting out of a complicated situation with too much debt,” Mr Fiala said.
“From our information, the debt restructuring talks were not going well.” Mr Fiala said ISD’s creditors included Citibank, Austria’s Raiffeisen, Société Générale, ING, Calyon Bank, the European Bank for Reconstruction and Development and the International Finance Corporation, a member of the World Bank Group.
Troika Dialog, an Moscow investment bank which is acting as exclusive financial advisor on the deal, would say only that the stake was being acquired by ”a group of profile and financial investors”.
However, Ruben Vardanian, chairman of Troika, said the deal represented a big move to consolidate metals assets in Russia and Ukraine and boost cooperation between the two countries.
”The deal is aimed at realising a strategy of consolidating metals assets across the territory of the [former Soviet Union] and could potentially lead to an expansion of cooperation between Russia and Ukraine, including in the growth of markets for the distribution and consumption of ... coal and iron ore.”
LINK: http://www.ft.com/cms/s/0/bdb0f1d4-fa22-11de-beed-00144feab49a.html
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