Blue - Corporate debt
Orange - Sovereign debt
Greenish - Banks
Source
Showing posts with label banking sector. Show all posts
Showing posts with label banking sector. Show all posts
Wednesday, February 17, 2010
Thursday, February 11, 2010
Ukrainian banks to recover soon?
Oxford Business Group undertook a study of a Ukrainian banking sector. Here are the conclusions:
Officials are hoping that banks will start opening the taps soon, and are planning to take some steps to encourage them to do so. On January 19, Valeriy Lytvytsky, the head of the group of advisors to the governor of the NBU, said it would be appropriate for the reserve to accelerate the adoption of a resolution intended to boost the credit activity of commercial banks.
Though details of how the NBU is to prompt banks to return to the loan market are lacking, predictions that the economy should move out of recession in the coming months and post modest growth by the end of 2010 may spark some interest amongst Ukraine’s banks to resume lending.
.............
While it will take time for Ukraine’s banks to regain the confidence to re-enter the loan market, the worst appears to be over for the sector, with some underperformers winnowed out and the remaining players potentially made stronger by the experience.
Officials are hoping that banks will start opening the taps soon, and are planning to take some steps to encourage them to do so. On January 19, Valeriy Lytvytsky, the head of the group of advisors to the governor of the NBU, said it would be appropriate for the reserve to accelerate the adoption of a resolution intended to boost the credit activity of commercial banks.
Though details of how the NBU is to prompt banks to return to the loan market are lacking, predictions that the economy should move out of recession in the coming months and post modest growth by the end of 2010 may spark some interest amongst Ukraine’s banks to resume lending.
.............
While it will take time for Ukraine’s banks to regain the confidence to re-enter the loan market, the worst appears to be over for the sector, with some underperformers winnowed out and the remaining players potentially made stronger by the experience.
Wednesday, February 10, 2010
Ukrainian banking sector registers losses in 2009
In 2009 Ukrainian banks has lost UAH 38,45 bn (~$4.76 bn) in comparison to the profits of UAH 7.3 bn (~$0.9 bn) in 2008 Association of Ukrainian Banks reports.
As of January 1 2010 assets of the banking system were at the level of UAH 880.3 (~$109 bn). During 2009 assets decreased by UAH 45,8 bn.
As of January 1 2010 assets of the banking system were at the level of UAH 880.3 (~$109 bn). During 2009 assets decreased by UAH 45,8 bn.
The main cause of assets decrease was the decrease in credit operations, which account for 79.2% of all assets. The level of bad loans increased by 3.88 during the last year.
Liabilities of the banks also decreased by UAH 41.7 and were at the level of UAH 765.1 bn (~ $94.8 bn)
Tuesday, February 9, 2010
Swedbank declares huge losses due to Ukraine's branch
Sweden's Swedbank has bought TAS-Kommerzbank and TAS-Investbank in Ukraine in 2007 from one of the current presidential candidates Sergiy Tigipko. He as a banker has built these banks for sale and perhaps was too liberal in raising their value too fast.
Swedbank has said that 53.46% of all loans in their Ukrainian branch are bad loans as of the end of the last year. This figure was at the level of 4.97% in the beginning of 2009. Overall Swedbank's losses in 2009 are at the level of $1,46 bn, of which $1,01 bn due to Ukrainian branch, formerly Tigipko's TAS-Kommerzbank and TAS-Investbank
It remains to be seen if Swedbank starts a suit against Mr. Tigipko, who sort of sold them a lemon...
But Swedbank's share fell marginally, by 0.5 percent, to 65.40 kronor ($8.79) on the Stockholm stock exchange.
Swedbank has said that 53.46% of all loans in their Ukrainian branch are bad loans as of the end of the last year. This figure was at the level of 4.97% in the beginning of 2009. Overall Swedbank's losses in 2009 are at the level of $1,46 bn, of which $1,01 bn due to Ukrainian branch, formerly Tigipko's TAS-Kommerzbank and TAS-Investbank
It remains to be seen if Swedbank starts a suit against Mr. Tigipko, who sort of sold them a lemon...
But Swedbank's share fell marginally, by 0.5 percent, to 65.40 kronor ($8.79) on the Stockholm stock exchange.
Thursday, January 21, 2010
Creditor's of Ukraine's defaulted banks can expect 40% recovery
Standard & Poor's Ratings Services said today that although recovery rates for creditors of defaulted banks in Kazakhstan, Russia, and Ukraine (KRU) have historically been muted, they could improve with support from the state.
"We believe that recoveries could be restricted and unpredictable, largely because of limited bank supervision and what we see as arbitrary frameworks for bankruptcy and bank restructuring in KRU," said Standard & Poor's credit analyst Sergey Voronenko. "In our view, this situation may be exacerbated by the approach of the banks' management and what appears to be asset stripping before default, as has been alleged in some recent bank liquidations. These aspects together with other factors have historically constrained our ratings on KRU banks."
"We expect the average recovery prospects for creditors to be less than 40% through the cycle, with strong disparities in individual cases," added Standard & Poor's credit analyst Ekaterina Trofimova. "This is despite some progress, most notably in Russia, from the previous decade. Recoveries may be even lower in 2010 and 2011, owing to the likely continuation of weak economic conditions in KRU.”
Source
"We believe that recoveries could be restricted and unpredictable, largely because of limited bank supervision and what we see as arbitrary frameworks for bankruptcy and bank restructuring in KRU," said Standard & Poor's credit analyst Sergey Voronenko. "In our view, this situation may be exacerbated by the approach of the banks' management and what appears to be asset stripping before default, as has been alleged in some recent bank liquidations. These aspects together with other factors have historically constrained our ratings on KRU banks."
"We expect the average recovery prospects for creditors to be less than 40% through the cycle, with strong disparities in individual cases," added Standard & Poor's credit analyst Ekaterina Trofimova. "This is despite some progress, most notably in Russia, from the previous decade. Recoveries may be even lower in 2010 and 2011, owing to the likely continuation of weak economic conditions in KRU.”
Source
Tuesday, December 22, 2009
Russia and EBRD - biggest investors in Ukraine in 2009?
According to Delo Vneshekonombank whose board is chaired by Mr. Vladimir Putin, made the largest investment into financial sector of Ukraine buying Prominvestbank for about $200 mln and augmenting its capital by UAH 4 bn. EBRD in 2009 made a record in financing investment project portfolio worth EUR 1,1 bn, including investments into financial sector. Source.
Wednesday, December 16, 2009
Ukrainian companies restructure debt
Banks and companies in Ukraine continue to restructure their foreign debts offering their creditor higher dividends in return for longer maturity. Konstantin Zhevago's bank Finance and Credit decided to restructure 95% of its debt until 25th January 2014 increasing the coupon payment to 10,5% (instead of 10,375%) with twice a year payments. UR has mentioned that Zhevago's Ferrexpo was recently successful in attracting USD 230 m financing facility. Vlast Deneg Journal (50/2009) also mentions that Viktor Pinchuk's Interpripe Limisted started negotiations with its eurobond's holders on concluding contracts that will make them refuse any actions leading to cross-default.
The year of 2010 will become critical for lots of Ukrainian companies who just approached default in 2009. Looks like next year we will see much more corporate defaults in Ukraine. Ukraine's economy will stabilize, just as the IFIs tell us, but it is likely to be a stabilization at the bottom of a deep well. Thus, unable to generate profits to pay off their debts corporations and banks will hit tough times about the spring of 2010.
Therefore, those who look ahead desperately try to restructure their debts now.
UPDATE. On Dec 18 Fitsch downgraded Pinchuk's Interpipe Limited company from "CCC" to "RD" - restricted default rating.
The year of 2010 will become critical for lots of Ukrainian companies who just approached default in 2009. Looks like next year we will see much more corporate defaults in Ukraine. Ukraine's economy will stabilize, just as the IFIs tell us, but it is likely to be a stabilization at the bottom of a deep well. Thus, unable to generate profits to pay off their debts corporations and banks will hit tough times about the spring of 2010.
Therefore, those who look ahead desperately try to restructure their debts now.
UPDATE. On Dec 18 Fitsch downgraded Pinchuk's Interpipe Limited company from "CCC" to "RD" - restricted default rating.
Tuesday, December 15, 2009
National's Bank dilemma
National Bank of Ukraine (NBU) is currently facing a dilemma: help real sector get loans but endanger stability of the banking system, or stabilize the banking system but let the real sector's credit lines run dry. Bad credit in the economy currently is evaluated at around 30-40% of outstanding credit portfolio. Letting the banks credit the enterprises means letting the banks somewhat loose. Making the banks deal prudently with bad credit means cutting credit in the economy and letting real sector suffer without credit. UR sources say that the price of all bad debt portfolio in Ukraine as of now might be worth about USD 30 m - not a very promising figure.
Monday, December 7, 2009
National Bank will evaluate banks early January 2010
Martin Reiser, World Bank (WB) director for Ukraine, Belarus and Moldova, said that National Bank of Ukraine (NBU) will conduct new diagnostic evaluation of Ukrainian banks in the first weeks of 2010. Such an evaluation will be used by WB for the decision on aid for rehabilitation of Ukraine's banking sector. First such evaluation was conducted in early 2009.
WB reps think that the worst scenario for Ukraine's banking sector was averted. Now the banks should work more on transparency of their ownership and protection of their clients.
Another point of critique is the policy of management of Ukraine's state banks. Oschadbank is said to be in a risky position due to issuing loans to Naftogaz, Ukraine's oil and gaz state holding. WB reps think that institution like Oshadbank should be restructured or liquidated. Interfax.
Subscribe to:
Posts (Atom)
