Ukraine’s central bank blames Kolomoisky for campaign of intimidation
29 Nov 2019

Ukraine’s central bank has issued an unprecedented statement accusing local oligarch Ihor Kolomoisky, the former owner of nationalized lender PrivatBank, of orchestrating a campaign of intimidation against the institution and its staff.

The National Bank of Ukraine (NBU) has been targeted by protesters accusing the bank’s management of corruption and demanding the resignation of governor Yakiv Smoliy and deputy governor Kateryna Rozhkova.

On Monday, a group of protesters broke into the bank’s premises.

“We believe that this pressure on the NBU comes from Ihor Kolomoisky,” the NBU said on Wednesday.

The central bank believes Kolomoisky and fellow former PrivatBank owner Gennadiy Bogolyubov siphoned off $5.5 billion from the lender before nationalization, an allegation that received backing from a 2018 report by US investigators Kroll.

In this week’s statement, the NBU said the protesters included employees of the Nikopol Ferroalloy Plant and other companies controlled by Kolomoisky, Ukraine’s most powerful oligarch.

It also named Ukrainian MP Oleksandr Dubinsky as the “main driver” of the protests and of a barrage of “negative statements and slander” in the local media.

Dubinsky, a former presenter on Kolomoisky’s 1+1 TV channel and a vocal supporter of the billionaire, was elected to parliament in July.

He is a member of the Servant of the People party of new Ukrainian president Volodymyr Zelensky, another 1+1 alumnus whose links to Kolomoisky have come under scrutiny since his move into politics at the start of this year.

In articles in local media and on his own website this week, Dubinsky denied organizing the protests, but repeated allegations of corruption against current and former NBU managers involved in banking sector reform and the nationalization of PrivatBank.

He also called on Zelensky to dismiss the chief executives of all Ukrainian state-owned banks, including PrivatBank, as well as Vladyslav Rashkovan, a former NBU employee and now Ukraine’s representative at the IMF. 

‘Chaos of information’ 

The NBU said the purpose of Kolomoisky’s campaign was to create a “chaos of information” to discredit the central bank, avoid returning the money taken from PrivatBank, and “interfere with Ukraine’s cooperation with international partners and, above all, the IMF”.

Ukraine’s government is seeking a new three-year extended fund facility from the IMF, but fund officials have made it clear that any further funding will depend on the vigorous pursuit of claims against PrivatBank’s former owners in the local courts.

A delegation from the IMF visited Kyiv this month, but left on Saturday without agreeing a deal. The previous day, Kolomoisky had told the Kyiv Post that the IMF “knows that PrivatBank will be returned to me in the near future”.

The Ukrainian government and PrivatBank are currently appealing a ruling from April by a Kyiv district court that the state takeover of the bank was illegal. A decision is expected on December 19, the third anniversary of the nationalization.

Meanwhile, PrivatBank has also come under intense pressure from its former owners in recent months. 

In September, police raided its Dnipro headquarters after obtaining a court order in a criminal case purportedly investigating the dealings of the bank’s management with consultants and advisers.

By Lucy Fitzgeorge-Parker, Euromoney, 28 November 2019

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