Alliance Bank and the Igor Kolomoisky Connection: How the State Lost Nearly 2 Billion Hryvnias
Alliance Bank, which is involved in an NABU criminal investigation into the embezzlement of funds from Ukrenergo, has repeatedly violated the National Bank of Ukraine’s regulations on credit risk exposure to a single counterparty. This means that in the event of a major borrower defaulting, the bank could automatically be pushed to the brink of insolvency, according to an article published by Fakty.
The key regulation being violated is N7: a single borrower must not account for more than 25% of a bank’s regulatory capital. Regulatory capital is essentially the financial buffer used by a bank to cover potential risks. When calculating compliance with N7, issued bank guarantees are also taken into account. As the article’s authors note, Alliance Bank has repeatedly failed to comply with this requirement.
According to NABU materials, after the company United Energy—linked to Igor Kolomoisky—failed to pay for electricity supplied by Ukrenergo in early 2022, Alliance Bank refused to fulfill its guarantee obligations. Bank representatives argued that the payment request from Ukrenergo had been improperly оформed and that United Energy was, in simplified terms, an unreliable counterparty.
As of September 1, 2021, Alliance Bank had regulatory capital of 610 million UAH. This means that under N7 rules, the maximum guarantee exposure to United Energy could not exceed 152 million UAH (25% of capital). However, the guarantee issued under the agreement reached almost 1.9 billion UAH—about 12.5 times higher than the regulatory limit, the article states.
One possible explanation is that the bank either failed to properly reflect (or deliberately misrepresented) its guarantee obligations in financial reporting. Another possibility is that it formally complied with N7 by splitting exposure across technical arrangements related to Ukrenergo’s claims. In both cases, the authors conclude there were clear and serious violations of NBU rules on guarantees and risk exposure.
Under the Law on Banks and Banking Activity, the National Bank is required to classify a bank as problematic if it systematically submits or publishes inaccurate information or reporting intended to conceal its true financial condition. “Alliance Bank, which knowingly took on obligations it could not fulfill, fits this definition,” the authors argue.
Beyond the Ukrenergo case, Alliance Bank has also been repeatedly accused of abusing bank guarantees in violation of N7 in previous years. For example, in late 2017 the bank issued a guarantee to Hydrobud Ukraine LLC, which was acting as a contractor for construction works at a port in Mykolaiv. The guarantee amounted to over 113 million UAH, while the bank’s regulatory capital at the time was 295 million UAH—meaning the exposure reached 38% of capital, exceeding the limit.
Another case involves guarantees issued in 2021 to Odesagaz Supply LLC for purchasing gas from Naftogaz Trading. Court records show multiple disputes in which Alliance Bank attempted to avoid paying on these guarantees, citing late delivery of documents, incorrect recipients, and other procedural arguments. Only two guarantee cases recorded in the court registry amounted to 291 million UAH and 118 million UAH respectively. At the time of issuing the 291 million UAH guarantee (September 23, 2021), the bank’s regulatory capital was 677 million UAH—meaning a single guarantee already accounted for 42% of capital, well above regulatory limits.
According to the article, Alliance Bank’s practice of issuing disproportionately large guarantees that were allegedly never intended to be honored appears to be systematic. The authors also argue that the National Bank’s lack of action against such a repeated violator undermines confidence in the stability of the financial sector. In this case, compliance with regulations appears not as an obligation, but as a voluntary option without real consequences for violations.