The established Ukrainian manufacturer and exporter of vegetable oil to Egypt – ‘Allseeds’ – is black-listed as a financially insolvent company. As follows the perspective of contract fullfillment of the products supply to Egypt is in question. Due to non-performing loans of “Allseeds” in the state Oschadbank the Ukrainian Parliament – Verkhovna Rada – has suggested the privatization of the bank.
The urgent audit of Oschadbank investigating bad loans protected by banking secrecy, including the scandal of a latest loan of USD 68 million. issued to the group ‘Alseeds’, is proposed by the member of the Parliament of Ukraine Viktor Romaniuk.
According to the independent experts, the credit will not be refunded due to ‘Allseeds’ financial insolvency, and Oschadbank will require additional capitalization of the next tranche from the state budget. Meanwhile, the Ukrainian citizens raised their voices in protest against compensation of banks bad loans at the expense of a taxpayers.
“The practice of recapitalization should be stopped once and for all. The state-owned banks should to privatized to stop the nationalization of the debts of the unscrupulous debtors, unfortunately in the system we have today it is unlikely to expected that at least someone will be brought to justice” – said Viktor Romaniuk, lamenting impossibility to bring to justice the responsible for the scheme.
In Ukraine, ‘Allseeds’ group loans and the like are called ‘political’, given in the days of the previous presidency. The experts agree that almost all assets, including ‘Allseeds’, purchased or constructed for credit funds of state banks are traced to the interests of the fugitive ex-President Yanukovych and his crownes.
The member of the Parliament Pavel Rizanenko does not believe ‘political’ borrowers will repay the loans, since all of them were taken initially under the terms of sunk. In particular, the group ‘Allseeds’ received a loan for the construction of a seed oil extraction plant in the Odessa area, which is located far away from most sources of raw materials, and has no proper facilities for handling finished products. All these factors made the project not viable, and as follows the credit – irrevocable.
“There is the highest percentage of risk per borrower in Oshchadbank. The loans issued to Yanukovych Jr., Klimenko, Arbuzov, Tsyplakov and Polishchuk, representing one large group, they accumulated almost a billion dollars of debt, “- said Rizanenko.
Financially insolvent borrowers in Ukraine massively evade repayment of loans state banks, with the help of a wretched justice system: it is much cheaper to pass through corrupt courts to reduce a refund or cancel it altogether, rather than returning the entire amount. “Only cowards pay debts”, is a popular saying among Ukrainian businessmen, who consciously follow the scheme to enrich themselves on non-return of debts at cost of a tax-payer. For this very reason members of Parliament offer to privatize urgently state-owned banks, convinced that private bank management is much more effective in working with problem debts.
Sadly, the borrowers massively abuse the system of Justice, initiating formal lawsuits of commercial disputes, and the other legal ways to ensure impossibility to claim a company property, said the member of the Parliament Ruslan Demchak,
However no one expected that a group of companies with Swiss investment ‘Allseeds’ to be involved in this ill practise, as many of experts considered the participation of the Western capital as guaranteed to ensure the spread of the best practises in Ukraine, enhancing its further integration in Europe, with its values, mentality and lifestyle. Unfortunately between two standards the lowest took over, putting at risk contract fulfillment towards important clients, including Egypt.