AUB appealed to the EU delegation about the obstacles in the negotiations on a free trade zone

The Association of Ukrainian Banks appealed to the delegation of EU negotiations on a free trade area (FTA), Deputy Director General General Directorate of the "Trade" of the European Commission Peter Balazs to comment on the rules of the bill N0884 for compliance with EU standards. As previously reported, in Kiev officially started XV round of talks between Ukraine and EU concerning the free trade area (FTA). The European delegation in the negotiations led by Mr. Peter Balazs. As stressed by the head of the Ukrainian delegation and Deputy Minister of Economy of Ukraine Valery Piatnitski: "This round of negotiations will be extremely important for the Parties in the context of determining further tactics aimed at the completion of the negotiation process." The strategic importance of concluding a treaty on the establishment of an FTA has been repeatedly emphasized by President of Ukraine Viktor Yanukovich. However, as noted in the AUB, the enactment N 0884 in the proposed wording could create a serious obstacle in these negotiations between Ukraine and EU concerning FTA. As noted in a letter to the President of AUB Alexander Sugonyako to head the EU delegation, Mr. Peter Balazs: "Taking into account the willingness of Ukraine to deepen its integration with the EU, the Association of Ukrainian Banks regard as abnormal the fact of a completely different environment for the business of credit institutions in Europe and Ukraine that, in our opinion, does not meet the basic principles of equal competition and creates a tangible obstacle to the continuation of the existing banks. " In AUB emphasize that the draft law N 0884 significantly contrary to the standards and EU legislation (Directive 2006/48/ES on the establishment and implementation of activities of credit institutions) and the recommendations of the Basel Committee on Banking Supervision on the regulation of the banking sector - Basel 1 and Basel 3. Consideration of the bill in 0884 N II reading four times already tolerated, including thanks to the efforts of AUB, as contrary to the requirements of Article 116 of the Rules of the Verkhovna Rada of Ukraine. However, in February of this bill again will be put before Parliament in reading II. In AUB believe that discriminatory legislation bill 0884 N negative impact on compliance with competition in the banking market, will have devastating consequences for the "small" and "secondary" banks, as well as increase the concentration of financial risks. "Today only 50 of nearly 180 Ukrainian banks have capital of more than 500 mln. Given the current situation and practices, we can assume that the amount of UAH 500 million. (More than 45 million euros) will be required by regulators as a minimum requirement to capital for existing banks. Now the regulator already requires that the existing banks have improved their regulatory capital to a size that exceeds the law for the creation of new banking institutions, "- said President Aleksander Sugonyako AUB.