PRESS: VEB may close Ukrainian unit Prominvestbank

MOSCOW, Aug 13 (PRIME) -- Russia’s state bank Vnesheconombank (VEB) has virtually abandoned the idea of selling its Ukraine-based unit Prominvestbank and is inclined to close it, a final decision will be made in November, Kommersant business daily reported on Monday citing sources.

One of the sources said that VEB is to break off its relationship with Russian and Ukrainian businessman Pavel Fuks, who wanted to buy the business, as he failed to get an approval of the deal in any form from the National Bank of Ukraine.

A source at the Ukrainian market confirmed that VEB makes no more attempts to sell off the unit and neither plans any more attempts, the daily reported.

A source close to Prominvestbank said that the main problems are loans issued by the bank, which will expire in no less than four years, and around U.S. $50 million of real estate property whose sale is complicated. Experts are sure that VEB’s loss from closing the branch will exceed 10 billion rubles.

In March 2017, Kiev introduced sanctions against all subsidiaries of Russian banks – Ukrainian units of Sberbank and VTB Bank, VS Bank of Sberbank, BM Bank of VTB, and Prominvestbank, prohibiting all financial operations in favor of affiliated parties, including parent banks.

(66.9075 rubles – U.S. $1)

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