The Verkhovna Rada of Ukraine recently passed Bill No. 11474, which simplifies the privatization procedure for state-owned banks. This move, supported by President Volodymyr Zelensky, is aimed at reducing the state's share in the banking system, particularly in the context of the requirements of international financial organizations such as the IMF and the World Bank.
What is changing?
The main changes introduced by the new law include:
- Expanding the circle of investors : The state can now consider selling not only 100% of the shares of banks, but also any stake, which opens up opportunities for various investors.
- Involvement of international donors : International organizations are given the opportunity to participate in the selection of financial advisors and in the privatization process, which increases investor confidence.
- Simplification of auctions : If only one potential investor participates in the auction, privatization can still take place.
- Use of the Prozorro system : The sale of state-owned banks will take place through the Prozorro system, which will ensure greater transparency and competitiveness of the process.
Which banks are preparing for sale?
Sense Bank and Ukrgasbank will be prioritized for privatization PrivatBank , Oschadbank, and Ukreximbank are also state-owned . This means that partial or full privatization of some of these financial institutions is possible in the near future.
Privatization during war: realities and forecasts
Against the backdrop of the ongoing war in Ukraine, the issue of bank privatization is causing mixed sentiments. Experts note that the war and economic instability may make it difficult to attract foreign investors. At the same time, according to the head of the National Bank of Ukraine, Andriy Pyshny, the possibility of implementing partial privatization with the participation of international financial organizations as early as 2025 could be an important step for economic recovery.
Privatization of state-owned banks, on the one hand, can provide new investments and reduce the financial burden on the state, but on the other hand, it raises concerns about the possible loss of control over key financial institutions.
