In October 1993, the NBU registered a new lending institution - Nadra Bank. Initially, he specialized in coal mining enterprises. More than 9,000 employees were employed at Nadra Bank CJSC. Branches located in all major cities of Ukraine served more than 1.5 million customers. In the best of times, the institution’s network included 700 branches in different cities, 1,000 ATMs and 4,500 terminals. The Nadra Bank card was almost the most prestigious payment instrument. After 2011, the rating of the organization began to decline. Read more about what is happening with Nadra Bank now in this article.
Services
Nadra Bank (Ukraine) offered its customers a wide range of products. Among the unique ones are tariff packages, which included all the elements necessary for the efficient use of funds: from current accounts to payment cards. For clients of small and medium-sized businesses, in addition, various credit lines were provided, servicing deposits opened with Nadra Bank CJSC, a client-bank for managing funds.
For individuals, entire sets of services have been formed.
The “First” package is the cheapest with a minimum set of features:
- draw up deposits in any currency for any period;
- open savings accounts;
- make payments through the cash desk with a minimum commission;
- use the “client-bank” for remote account management;
- Configure recurring operations.
As part of the “Free Money” package, the client could already activate SMS informing, withdraw funds from the card without commission and accumulate money on deposit when making settlements at retail outlets with a credit card. “Family” opens up access to the same services, but on more favorable conditions: increased interest rate on a savings deposit, more loyal conditions when applying for a loan, etc. Having issued the “Social” package, pensioners got access to a current account and attached to him a map for free. Especially for VIP-clients Gold and Platinum programs were developed, within the framework of which the client received individual service and an additional set of advantages.
Achievements
The institution participated in a funding program established by the EBRD. Since 2011, the main shareholder has been Centragas Holding GmbH (89.97%). In order to increase the value of assets, several investment specializing funds have been created. The IRR return rate was at 25%. The average term of the deposit was 4.5 years. Also a lending company “Dogmat Ukraine" was created; leasing center "Eurofinance" and IC "Investservice". All of them functioned outside the bank, but actively collaborated with the organization as part of cross-selling products.
Financial performance
According to the results of the III quarter of 2014, the institution did not comply with a number of regulatory requirements of the NBU. The current liquidity ratio fell to 20.87% with the required 40%. The maximum amount of risk per counterparty amounted to 28.65% (standard - 25%). People began to collect deposits of Nadra Bank en masse. This has led to a deterioration in asset quality. For the 3rd quarter of 2014, the volume of deposits decreased by 1 billion UAH. Although the real outflow was even greater: due to the devaluation of the hryvnia, deposits in foreign currency grew.
Re-capitalization
Nadra Bank (Kiev) was included in the list of institutions that the NBU allowed not to repay debts to maintain liquidity. Specifically, this institution in September was supposed to pay off the amount of UAH 900 million to the regulator. The due date was deferred to December 2014. The problems in the credit institution are also evidenced by the fact that at the end of June the bank turned to the holders of Eurobonds with a proposal to restructure the debt. The loan amounted to $ 59.66 million with maturity in June 2017.
Nadra Bank (Ukraine) already lacked funds during the 2009 crisis. Then the NBU introduced an interim administration to the institution and supported the activities of the bank until a new investor was found - Centragas Holding GmbH. The old debt was due in 2016. But, according to unofficial data, the bank not only did not start repaying the loan, but also got on the list for the next recapitalization in 2014.
Attempt number two
On February 6, 2015, the Individual Deposits Guarantee Fund (FGVFL) introduced a provisional administration in Nadra Bank (Kiev), and a week before the Pension Fund chose an institution to pay benefits to Ukrainians. The NBU explained that due to the undercapitalization of the bank according to the requirements of stress tests, the institution was declared insolvent. Most of the deposits (99%) do not exceed the amount of 200 thousand UAH. These loans should be repaid by the FGVFL after the provisional administration is introduced in Nadra Bank. Customer reviews on the forums confirm that this process is ongoing with periodic success. Only 1% of depositors have savings in excess of 200 thousand UAH. Such clients can split their contribution into several and receive funds in full. The total amount of payments will be more than 3.5 billion UAH.
What is the reason
The NBU explains that the bank still has not coped with the crisis of 2009. Neither new investors, nor attempts by managers to stabilize the situation helped. An expert analysis of capitalization plans showed that the institution will continue to generate losses. Therefore, it was decided to introduce an interim administration. The former management (until 2009) issued loans without collateral. The papers seem to be drawn correctly. But there is no reserve as such in the form of assets. To cover current debts, a reserve formed already under Firtash will be used.
Nadra Bank: reviews
The deterioration in financial condition affected not only depositors, but also employees of the institution. In order to explain to people a hundred times a day the scheme of receiving a deposit through the FGVFL, as well as to listen to the comments of disgruntled persons, one must have strong nerves.
Problems in customer service began even at a time when the Nadra Bank was functioning steadily. The reviews of people on the forums confirm that intermittent failures in the online banking system have occurred. Money did not reach the necessary details, and they had to be searched for a long time. Part of the indignation was expressed against the hostile behavior of the employees of the department. But this problem is not new and is found in many institutions.
Ukrainians became very active after the introduction of the provisional administration in the Nadra Bank. Reviews on forums contain both an offer to sell a deposit for hryvnia, as well as tips on how to transfer funds to another institution. In particular, in the latter case, it is necessary to write a power of attorney in which to indicate that the financial institution can receive client money, including from the Federal Financial Markets Fund, and provide this paper to Nadra a few days before payment.
For savings - to court
Due to the prolonged financial crisis, people began to take deposits in large quantities. A strong decline in liquidity and deterioration of assets leads to the fact that a temporary administration is introduced into the bank. According to the law, from now on the FGVFL should deal with the return of funds to customers. Registering takes a lot of time. Many try to return the money through the court. Now the probability of a positive decision is even higher. The Supreme Court ordered financial institutions to pay money not only for the term of use of the deposit, but also for the period that has passed since the end of the contract.
The defendant in several such claims was Nadra Bank. Testimonials of customers who have tested this scheme indicate that the court decision is not made in favor of the credit institution. But it’s worth taking such a step only if the amount of the deposit exceeds the guaranteed by the fund. Otherwise, legal costs may cover the amount of the deposit. But this only applies to violation of payment deadlines. Another thing is the issuance of a dollar deposit in hryvnia. The law stipulates that in this case the money is paid in national currency at the NBU rate on the day the license is revoked. This is exactly what is happening with Nadra Bank. The license was taken on 02/06/15. The official exchange rate at that time was about 18-19 UAH / USD, and at the interbank market - 23-25 ​​UAH. The difference is enormous, especially if the amount of the deposit is several thousand at. e. Dissatisfied investors tried to challenge such a decision in court, but there is no result so far.
Bank liquidation
In April 2015, the NBU decided to withdraw from the market "Nadra Bank". The first payments have already passed in May 2015. On June 12, 2015, the second stage of the return of deposits begins. It will last until July 23, 2015. Funds will be paid through the agent of Raiffeisen Bank Aval. The decision to reimburse the deposit to persons who do not contact the agent at the indicated time will be considered individually after this date. The NBU allocated one year (until July 2016) to prepare documents for the liquidation of Nadra Bank.
Conclusion
Ten years ago, one of the largest credit organizations in the country was Nadra Bank. “Client-bank”, current, deposit, card, salary accounts, insurance, leasing - this is only a small list of services that a financial institution provided to the population. During the crisis of 2008-2009 , the bank required additional capitalization. Then it was bought by Centragas Holding GmbH. But the measures taken to restore the financial condition were not enough. In February 2015, a provisional administration was introduced into the bank. A financial analysis showed that there is no point in sanitizing the bank. Therefore, a decision was made to eliminate it. The first payments to depositors have already passed. The second wave is scheduled for the period from 06/12/2015 to 07/23/2015.