Ukraine begins repayments to depositors of Soviet-era Savings Bank today

Today Ukraine begins to repay billions of hryvnias in failed Soviet-era bank deposits.

According to the press service of the Oshadbank OJSC [Savings Bank of Ukraine], people, who were put on the depositors list on January 8, can turn to the bank either to register their checks or deposit accounts, or to receive the repayment in cash, since 11 January.

According to the information of the press-service, in order to receive the compensation payment, it is necessary to produce the following documents: a coupon of the written order, a passport of the citizen of Ukraine, and a USSR Bank’s savings book.

The Ukraine’s Savings Bank emphasizes the repayment of the Soviet Savings Bank debts is not limited in time. The Bank also asked the depositors “to refrain from rush in bank’s offices, to be reserved and polite” and promised compensations will be paid indefinitely.

Earlier Prime Minister Yulia Tymoshenko said compensations for devalued deposits will be paid in two years. In 2008 the government will allocate 20 billion hrivnas (some four billion dollars), which will comprise 60 percent of the debts.

The UAH6 billion in cash will go towards clearing only UAH1,000 by each depositor, and the government plans to encourage the people to leave the money on the account by offering high interest rates: 9.5% for US dollars and 13.5% for hryvnias.

“Anyone is guaranteed to get what is envisaged by the budget,” Tymoshenko said, appearing on ICTV television in prime time, and promised the payments will not boost inflation. “They will be done in such a way so that the money does not devaluate on the way to a shop,” she said.