With Crimea holding a referendum on secession from Ukraine and the International Monetary Fund preparing a rescue package, there is growing uncertainty around the country’s financial stability. The National Bank of Ukraine has restricted foreign currency withdrawals to avoid a run on the Ukrainian hryvnia.
Even before the current crisis, several western European banks active in Ukraine had been battered since the global recession in 2009 caused a surge in non-performing loans. For the three years from 2010 to 2012 inclusive, the top 20 foreign-owned banks in Ukraine lost an aggregate of more than $960m. Unsurprisingly, over 2012 and 2013, a series of western European banks including Sweden’s Swedbank, Italy’s Intesa, Austria’s Erste Bank, Germany’s Commerzbank and Greece’s Alpha Bank, all sold subsidiaries in Ukraine, and all to local buyers.
