Setting up and selling a transitional bank as a means of bringing the activity of an insolvent bank to the requirements of economic standards

Abstract

The article is devoted to the study of the ways of economic rehabilitation of insolvent banking institution. A special place in the work belongs to the issues of establishment and sale of a transitional bank as a means of bringing the activity of an insolvent bank to the requirements of economic standards. Attention is drawn to the debatable nature of the economic and legal subjectivity of the Deposit Guarantee Fund of Ukraine in the stated procedure. Among other things, the characteristic of economic standards of banking activity is given and the importance of liquidity assessment in the systemic characteristic of the bank is noted. It is pointed out that the procedure for setting up and selling a transition bank is in line with the EU standards as for the rehabilitation of credit institutions and the withdrawal of them from the market.

Critical attitude to the legislative approach is maintained, and it is noted that bankruptcy procedures for banks cannot be in sharp conflict with general bankruptcy procedures regulated by the Bankruptcy Code of Ukraine. It is emphasized as the positive moment that there was no withdrawal of any bank - resident of Ukraine from the market due to the insolvency in 2019.

Specific features of the legal status of the transitional bank include, in particular: simplified setting up and licensing procedures; specifics of formation of authorized capital; specifics of application of economic standards; specifics of the transfer of assets and liabilities and, finally, specifics of taxation. The investor’s compliance with these obligations in this part causes termination of the Fund’s participation in the respective legal relations and, accordingly, full restoration of the bank’s economic turnover in the financial services market.