Recently, the management of the National Bank of Ukraine have been gradually changed in a worrying way, Director of the Swedish bank SEB, Kristian Andersson tells Ukraine Nu.

Katrina Rozhkova, one of the last members of the old higher management in the National Bank of Ukraine, got into a public fight with the new management. She claimed that she was being shut out from the decision making progress in the bank.

After saying this she was quickly shot down by the communication department of the NBU, who allegedly tried to make have the statements made by Rozhkova in the press withdrawn.

Since then, the finance sector of Ukraine have been holding their breath, because it is now uncertain what will happen to the National Bank of Ukraine, Kristian Andersson, the director of SEB tells Ukraine Nu.

“There are two members remaining from the old management, Sologub and Rozhkova. They have contracts expiring this summer, and I would guess, that they would both leave. It is very unfortunate,” Andersson says.

“Nobody knows what will happen. When we look back to the days of the revolution, the National Bank have been a great exception, a success story all the way up until Smolii left,”

Andersson says.

Smolii’s departure from the NBU triggered a chain of events leaving up to today. Not only did it define the image of the National Bank of Ukraine, it also heavily influenced Ukrainian cooperation with IMF.

As Smolii said he was leaving because of political pressure from the office of Volodimir Zelensky, this sowed great distrust between Ukraine and IMF who only had one requirement for Ukraine to receive the next tranche of the important 5 billion dollar loan: independence of NBU.

However, though it seems like NBU is being manipulated by the president and his administration, no big changes in the day to day work of the bank have been seen as of now.

“From a policy point of view, we don’t see a big change as bank. They have not done bad, we can’t say that we have seen a lot of concrete things happening. But I think everybody is suspicious, waiting to see the developments, and seeing them change the management is not a good sign, because the track record of the previous management was undeniably good,” Andersson says.

IMF is like a travel guide for investors

Before you go on a vacation, you buy a guide book or research the destination online. Naturally, for investors the process is much the same: They research a country, looking for threats and opportunities for investments.

In this regard, Andersson says, the IMF cooperation with Ukraine can be seen as an indicator of which direction the country is moving in:

“Investors look at cooperation with IMF, and if that is working well, investors take some confidence in that. Right now, IMF is saying that the big question mark is, whether or not NBU will keep independence. So in that way, the problems in NBU influences the investment climate,” Andersson says.

Right now, no tranche is coming which, according to Andersson, is sending a negative signal. Apart from that, Ukraine could really use the next tranche for the payments coming this September.

“In September, there are quite a few repayments that should happen. Around 3 billion dollars are owed, and while Ukraine has foreign reserves today, they will not go bankrupt and can handle it. But without IMF, I think it would send inflation racing and further devaluation of the currency,” Andersson says.

“The Government need to show clear signs that they will do reforms, and the best way to do that is through cooperation with IMF,”

Kristian Andersson

Who is applying the pressure?

According to Andersson, there is one big question right now regarding the changes in management of NBU, though a lot of information is still being kept hidden in the deep vaults of the National Bank.

“Obviously, I don’t know the details. I don’t have access to the information, but what is very clear since the governor was change is, that there has been an obvious process of changing the management in NBU. But why?,” Andersson says.

“We don’t know. We are afraid of interests from outside pushing the governor. People like Kolomoiskiy or his team. It was clear from the beginning, that the new governor would change big parts of the management. He is well on his way to change everybody and I think that this summer, the two last remaining members of the old management will leave.