“It Cost Ukraine 7% of GDP”: Gontareva in London Talks About the Nationalisation of PrivatBank (VIDEO)

In Ukraine she is suspected of embezzling money, while in Britain she gives lectures.

TK Media has obtained a video of the former head of the National Bank of Ukraine speaking at the London School of Economics about the nationalisation of PrivatBank carried out under her leadership.

Below is a translation of her monologue from English.

“Name me at least one existing country with a similar problem. There is none. I will explain why.

[PrivatBank] — was not just the largest bank by debt obligations and private deposits (33% of all private deposits in the country) — it had 20 million customers, 3 million pensioners were served there, and around 600 small and medium-sized enterprises.

This bank was quite advanced technologically, and 50% of business transactions in our country went through this very bank. That is why it is an absolutely unique case. If we look at other countries, for example, any large US bank. All of them are public joint-stock companies, and the largest shareholder owns maybe 5% of the shares, and that's all.

If we look at Russia — and that is a good example, since it is also a post-Soviet country — its largest banks, which cover more than 50% of the system, are state-owned: Sberbank, VTB.

If you look at China's largest bank, for example, you will see exactly the same thing. The largest bank with the greatest number of individual deposits — is a state-owned bank.

That is why it was absolutely unique that this bank belonged to one particular oligarch in our country. And that is a very, very big problem.

Valeria Gontareva
former head of the National Bank of Ukraine

Because when we examined this bank, we found that there was not just no capital, there were no assets at all. Therefore, after the nationalisation of this bank, the state injected 150 billion hryvnias of capital (as we call it), but in reality — of assets. Because there was a void.

But even the audit conducted after nationalisation, carried out by Ernst & Young, showed that the bank needed an additional 34 billion hryvnias in recapitalisation. And this was done.

To give you an idea, even finance ministers said: it is better to liquidate this bank, because it would be cheaper for our budget. And the finance minister, of course, looked at this from the perspective of budget expenditures. It cost 7% of GDP — each of you, each of us had to pay for this bank.

But again: we cannot speak only about the consequences of the blow to the budget, because financial stability — is a priority. Financial stability — is a priority not only for the National Bank, it is a priority for the Ministry of Finance, for the Cabinet of Ministers, for everyone. All bodies in Ukraine supported the nationalisation of this bank.

And, in the end, it was nationalised. And for two years now this bank has been operating, showing a profit, everything is fine. And I hope, even despite the fake decisions of Ukrainian courts, everything will be fine. I cannot even imagine what could destroy the stability of Ukraine's financial system. No one can even seriously consider this.”

Yesterday, lawyer Andriy Portnov reported that the Prosecutor General's Office had sent a request to Britain for information about Gontareva: grounds for her residence in the country, bank accounts, etc.

The Prosecutor General's Office suspects Gontareva of embezzling 150 million hryvnias.