OREANDA-NEWS. On May 27, 2008 as was informed by the Bank press service.

Ukrsotsbank Chairman, Borys Tymonkin sees no threat to small banks owing to deficit liquidity.

Borys Tymonkin: "In terms of growth everything is not bad. Indeed, we have inflation but people started to earn more. Economy is objectively alive. Businesses grow rapidly, people want much - just give! Build, deliver, sell! Hence - the growing demand for banking services.

Small banks have an undeniable plus - they didn’t make serious international borrowings. Maximum 20 Ukrainian banks have made some borrowings from the external market. Small banks benefit from some support of shareholders who understand and are aware of the value of their business. And the banks will seek their support.

As I said, thanks to inflation it is easier for people to repay loans. And clients are ready to pay bigger interests. Banks will pay more for deposits, will attract more ... A year ago we calculated, the average term of "life" of credit. For mortgages, with an average term of credit over 10 years, their actual maturity averaged seven years. For autos - with four-year term loan real return was 2.2 years. This year we again made the drawing. Having significantly lengthened the maturity term medium term of "life" of mortgage loan decreased to 5,2 years, car loans - just to half years.

There is another interesting fact. The first two months of this year. In retail clients have made new loans at UAH 2.3 billion, repaid - at UAH 1,3 billion. The balance makes only one billion. That is in a month they repay UAH 650 million!

This, incidentally, reserve of liquidity: if the bank suddenly because of its deficit would have to stop lending, then in a month its resource base to be increased by UAH 650 million. Much to this, of course, contributes inflation. Always, when the money devalues, people want to either invest or repay some debt and remove the risk of tangible asset. But it also demonstrates the financial health of borrowers.

So I do not share the increased apocalyptic predictions. Fine performance, of course, noticeably decreased, albeit high, but controlled inflation does not interfere with healthy and actively growing economy. The regulator when supported by the Government is able to stabilise the situation gradually. The main thing is not overdo with liquidity and not to make too sharp exchange rate movements, changing the rules of the game on the market".