The created in mid-July banking group of FUIB consolidated two banks, five insurance companies and one investment company. Despite the fact that the regulation on the identification of banking groups was adopted by the National Bank a year ago, the financial institutions have been slow in consolidation. The banking regulator sets more stringent requirements to the groups. However, the complex ownership structure of Ukrainian companies and the inability to determine the ultimate beneficiary still allow the owners to avoid sanctions by the NBU.

Yesterday the creation of the FUIB banking group, which included FUIB, Bank Renaissance Capital, investment company "Tesera Capital", insurance companies "Aska", "Asko Northern Donbas", "Aska-Life", "Illichivska" and insurance society "Illichivske, was announced. The corresponding decision No. 501 was met by NBU Commission on Supervision and Regulation of Banks on July 19. Now FUIB will report quarterly on the financial results of the whole group: up to the end of the 2013 the reporting will be carried out in a test mode, and starting with 2014 it will happen on a regular basis, "Kommersant" was informed by the bank.

The need for the grouping is related to the fact that in 2011 in the law "On banks and banking activity" supervision on a consolidated basis was specified for the first time. Regulations prescribing the procedure for registration and reporting of banking groups were provided by the National Bank in the spring of 2012 (Resolutions No. 134 and No. 254). "After that, we had the opportunity to apply for registration of a banking group at the NBU to comply with the law," commented the press service of FUIB.

According to the law, the banking group may consist of the parent bank and its Ukrainian and foreign subsidiaries or associate financial institutions. In addition, the banking group is two or more financial institutions in which banking generates more than 50% of the total assets of members of the group over the last four fiscal quarters.

Adopted in 2011 changes are the requirement standards of Basel. "Theoretically, the creation of banking groups will allow the regulator to improve the supervision of banking institutions: more stringent standards are set for the groups," the chief financial analyst of rating agency "Expert-Rating" Vitaliy Shapran said. National Bank will be able to prevent the withdrawal of funds from the bank by limiting the amount of funding provided to related entities. "In addition, it will increase the transparency of the market: the participants will see which companies are a part of the group, which joint projects they have and what risks they bear," a member of the management committee of GARP Vadym Berezovyk.

In Ukraine, there are several financial institutions that belong to the same owner. They typically include banks, leasing, factoring, insurance companies and asset management companies. For example, the Hungarian OTP controls in OTP Bank Ukraine, AMC "OTP Capital", "OTP Leasing" and "OTP Factoring Ukraine." However, the owners of bank assets do not hurry with registering said of banking groups. NBU approved the regulations over a year ago, but about the registration reported only one group so far. "The ownership structure of Ukrainian banks and financial companies is so, that it is difficult to determine the ultimate beneficiary. As the result, the National Bank can not impose sanctions on the companies under its control," Vadym Berezovyk says.

Source: Newspaper Kommersant Ukraine from August, 2, 2013.