This Is the Last Straw: Dragon Capital CEO Says Ukraine Investment Suspended After NBU Chief Resigns

In Fiala's view, Ukrainian authorities are acting against the advice of investors and international institutions.

The CEO of investment company Dragon Capital, Tomas Fiala, told comments to NV.ua that after yesterday's resignation of NBU Governor Yakov Smoliy he is suspending investments in the country. The company head explained this decision by saying that, in his view, Ukrainian authorities are acting against investors.

“We will postpone new investments, because over the last five months the authorities have been doing the exact opposite of what investors, both domestic and international, expect from them and advise them to do. This is the last straw. One can only guess what the motives are: complete incompetence or Russia-driven sabotage,” — Fiala said.

Tomas Fiala

CEO of Dragon Capital

The worst thing is that this was done under political pressure from the very top. This is a red line for all investors: G7, IMF, WB. Complete incompetence and deception by those who gave us 5 billion dollars over the last month, including today's Eurobonds.

In a statement on his resignation as head of the National Bank, Smoliy wrote yesterday. He explained the decision by citing “political pressure.”

Despite Smoliy's resignation, members of the NBU board stressed that they will continue working in their posts to maintain macro-financial stability. Following Smoliy's departure, the duties of head of the National Bank of Ukraine will be assumed by his deputy Yekaterina Rozhkova.

Today, Smoliy's resignation statement is to be considered by the relevant committee of the Verkhovna Rada of Ukraine, and tomorrow, July 3, it is to be put to a vote in parliament. If Smoliy's resignation is not accepted, he will be forced to continue as head of the National Bank.

NBU independence — one of the requirements of the International Monetary Fund. In mid-June, ambassadors of G7 countries expressed concern about the possibility of undermining the independence of the National Bank.

Yakov Smoliy has worked at the National Bank of Ukraine since 2014. After Valeria Gontareva's resignation in March 2018, he headed the NBU.

The NBU's most high-profile case during Smoliy's tenure at the institution was the nationalization of PrivatBank. In mid-June, the Supreme Court sided with the National Bank in the case of PrivatBank and the Surkis brothers, recognizing them as persons related to the bank.

In early June, the National Bank cut its key rate to 6%, which is a historic low for Ukraine.