It is much more difficult for a business to restructure a loan from a state-owned bank than from a commercial bank, as they impose stricter conditions and terms. This was stated by Oleksandr Plotnikov, Head of Banking and Finance at Arzinger, in an exclusive commentary to UNN.
Restructuring is an effective and reasonable way to solve the problem of debt default. It allows borrowers to continue their work and develop their business, while banks retain their clients and avoid increasing their portfolio of distressed assets
According to him, a loan can be restructured on the basis of the relevant law or on the basis of general norms of Ukrainian legislation, without applying a special procedure. However, the second option is used only by commercial banks, as it is simpler.
On the other hand, banks with a state share are less flexible in their approaches to restructuring borrowers' debt due to their special status. Therefore, they more actively use the opportunities provided by the law on financial restructuring, which to some extent protects them from possible claims from law enforcement agencies
The expert emphasized that the main condition for debt restructuring is the prospects of the borrower's business and the consent of the creditor and the debtor to such restructuring. In other words, the lender must be sure that the borrower will be able to fulfill its obligations in the future.
"From an economic point of view, the restructuring scenario is more favorable for the lender than foreclosure on the borrower's property and property guarantors (if any) or bankruptcy. The debtor must be willing to fulfill its obligations after the debt restructuring. Otherwise, restructuring is pointless," he added.
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It is worth noting that loan restructuring is not a panacea, but a temporary solution that allows you to buy time and stabilize your financial position. It does not eliminate the problem, but it does allow you to survive difficult times and avoid catastrophic consequences.
One of the representatives of Ukrainian business who, in response to financial difficulties , resorted to loan restructuring is the owners of Gulliver Business Center. It is worth emphasizing that the owners of this business complex have a loan from the state-owned bank Oschadbank.
In this case, the debt restructuring was carried out in accordance with a law that was developed at the initiative of the IMF and provided for special safeguards to ensure that the entire process was carried out without abuse. One of them is the participation of third-party independent experts, which is why world-renowned companies were involved in this case. The experts offered more than 10 restructuring options and, in accordance with the law, chose the one that would maximize the economic benefits for the involved creditor banks. Thanks to the debt restructuring and the resumption of economic activity, Gulliver managed to stabilize the project's financial condition.
And, as the lender, Oschadbank, emphasized, the owners of Gulliver strictly adhered to the terms of the financial restructuring before the outbreak of the full-scale war. At that time, almost all Ukrainian banks provided their clients with loan repayment holidays, and then there was a gradual process of resuming loan payments. In 2023, the owners of Gulliver returned to debt service as part of the restructuring agreement.