News
20.10.2008
UKRAINE'S CENTRAL BANK UPS DEPOSIT INSURANCE
KIEV - Ukraine's central bank will raise the amount of immediate
compensation given for lost deposits to 100,000 hryvnias ($20,408) from
50,000, the bank's council head Petro Poroshenko said on Wednesday.
The move comes after the bank imposed temporary measures on Monday on
banks aimed at making sure that deposits are not withdrawn early, while
curbing borrowing and lending.
A run on the country's sixth largest bank, Prominvest, after speculation
of a murky takeover deal, prompted the central bank to place it in
receivership and authorities have been keen to ensure panic does not
spread to any other banks.
The central bank has repeatedly declined to link the run on Prominvest to
the global financial crisis. It has provided 12 billion hryvnias ($2.4
billion) in refinancing so far this month for banks, double the 6 billion
hryvnia in September.
Poroshenko also said nationalisation could be a solution to the problem of
Prominvest, but such a solution would need the support of parliament --
which was dissolved last week ahead of a Dec. 7 election after the ruling
coalition collapsed.
"We should chose the way (to solve the Prominvest problem) that has been
implemented by the majority of governments and central banks in Europe and
the United States," Poroshenko told a news briefing. (Editing by Ron
Askew)
