Daily monitor

The National Bank of Ukraine has introduced a three-fold increase in fines for banks that have committed violations of Ukraine’s legislation pertaining to foreign currency exchange operations.

The Kyiv aviation plant Aviant intends to produce ten airplanes in 2010. According to Ukraine’s Minister of Industrial Policy, four An-148 and six An-32 would be produced. At the same time, the Kharkiv State Manufacturing Company produced an An-74T-200A airplane for Egypt.

The ‘Ukrros Sugar Union’ [UROS UZ], a major sugar producer in Ukraine, has announced that it intends to invest USD 7.5 mln (UAH 60 mln) towards upgrading production capacities at its seven plants in 2010. In particular, the Company plans to gear its factories towards using domestically-produced coal instead of gas.

The NBU resolution #569 came into force on November 30, 2009. This decision stated that interim administration would be introduced on any bank in the case that the adequacy of its regulatory capital requirement decreases to a level that is less than 7%.

The National Energy Regulatory Commission of Ukraine (NERC) has raised retail electricity tariffs for non-household consumers by 1%. As of December 1, large electricity consumers (35 kV and above) will be paying a rate of UAH 462 (USD 57.7) per MWh, while smaller consumers (below 35 kV) will be subject to tariffs set at UAH 613 (USD 76.6) per MWh.

The Ministry of Fuel and Energy of Ukraine announced that the first auction for electricity exports will be held on December 16, 2009. The transmission grid operator Ukrenergo, which is organizing the auction, should announce the details of the auction on December 8, according to the Ministry’s statement.

In November 2009, Ukrainian steel production reached 2.7 mln mt, a 1% decline compared to October 2009. Most of the large steelmakers improved their monthly steel output: ArcelorMittal Kryvyy Rih [KSTL UZ] produced 516 thsd mt (+3% MoM), Mariupol ISW [MMKI UZ] was at 390 thsd mt (+12% MoM), Dnipropetrovskiy ISW [DMKD UZ] was at 294 thsd mt (+14% MoM), and Enakiyevo ISW [ENMZ UZ] was at 213 thsd mt (+24% MoM).

According to the Moody’s international rating agency, the forecast for the Ukrainian banking system remains negative, reflecting the precarious state of the fundamental credit quality of local banks in the medium term.

The Land Bank of Bavaria (Germany) has expressed its intention to give the National Joint Stock Company ‘Ukragroleasing’ a major loan under a government guarantee. The credit will go towards the purchase of sugar beet harvesting machinery, which will subsequently be leased to farmers. The loan amounts to EUR 40 mln and the repayment is scheduled to take place over a period of 7-10 years. The machinery will be purchased from two separate German producers: Ropa and Holmer.

The shareholder meeting of Ukrnafta [UNAF UZ] on November 27, failed due to the fact that the registrar, Ukrnaftogaz, which is affiliated with Privat Group, didn't provide the shareholder registry. More hopes were placed on this particiculare EGM, compared to previous attempts to hold meetings, due to the existence of negotiations between the state and the Privat Group on the issues of the further management of the Company and the state’s willingness to formalize cooperation by signing a memorandum of understanding between UNAF's shareholders.