The Kernel of the Economy in 2007

Denis Lysenko, a partner with Vasil Kisil & Partners pointed out the key trends in the banking and financial sector: “2007 was another year of excellent growth in the domestic banking sector, marked by continuing entry of major European, Russian and Middle Eastern players placing the aggregate share of foreign capital in the Ukrainian banking system at around 50% by the year-end, and a new trend of true mergers between Ukrainian subsidiaries of foreign banks (Unicredit Bank and HVB Ukraine, VTB Bank and Vneshtorgbank (Ukraine), and a number of smaller banking institutions in the same process). The National Bank of Ukraine showed its persistence in improving the regulatory framework for consumer lending and protection of consumer rights. However, in terms of the foreign currency control regime, many of the practical hurdles as regards foreign investment and cross-border flow of capital still have to be dealt with.”

The banking and finance team of Baker & McKenzie is among the strongest in Ukraine. Its extensive experience can be seen in an impressive list of deals. For example, in terms of syndicated loan facilities, it advised System Capital Management, Ferrexpo AG and Poltava GOK Mining Company, Standard Bank in crediting Bank Khreschatyk, advised a syndicate of banks headed by HSBC Bank in connection with a syndicated facility to CJSC Alfa-Bank. Rather notable deals in the sector were a USD1.5 billion pre-export revolving term loan facility to the Metinvest Group (serviced by Baker & McKenzie). Serhiy Chorny has received excellent references and is considered one of the strongest banking lawyers in Ukraine. Anna Makedonska, Ihor Olekhov, Oksana Simonova, Glib Bondar, Vsevolod Volkov, Iryna Nurzad are named due to their involvement in corresponding projects.

In 2007, Sayenko Kharenko was involved in a large number of the most significant finance transactions in the country. The firm was traditionally instructed by major multinational and leading Ukrainian banks to advise on the most sophisticated cross-border financings in Ukraine. Thus, the team acted for arrangers in the largest syndications to Ukrainian banks, including for HSBC, Standard Bank, BayernLB and DZ Bank in a USD 500 million syndication to Raiffeisen Bank Aval, which is so far the largest syndication by a Ukrainian bank; Deutsche Bank and Standard Bank on a USD 325 million syndication to The State Export-Import Bank of Ukraine; HSBC, BNP Paribas and BayernLB on two syndicated loan facilities to UkrSibbank for a total value of USD 360 million; BTMU, HSBC, Intesa San Paolo and BayernLB on a USD 200 million syndication to Raiffeisen Bank Aval; Bank Austria on a USD 200 million syndication to Ukrsotsbank; Bayern-LB and Fortis Bank on a USD 130 million syndication to Bank Nadra. The firm advised international lenders on the country’s largest financings to major state and privately held corporations, including Barclays Capital on a USD 550 million loan to Ukrainian Railways; and Citigroup on a EUR 33 million loan facility to Zaporozhstal. This year the firm has also handled a USD 180 million securitisation by PrivatBank, which is the first and so far only securitisation in Ukraine, acting for UBS as the lead manager. Michael Kharenko, Nazar Chernyavsky and Oleksandr Olshansky are the firm’s leading experts in the area.

Shevchenko Didkovskiy & Partners has traditionally strong positions and an experienced banking and finance team, which includes the firm’s partners Armen Khachaturyan — head of the practice, Iryna Pokanay and Svitlana Poroschuk, and senior associate Leonid Antonenko. Deals in the banking and finance field include advising Swedbank AB in connection with acquisition of a 99.99% shareholding in OJSC TAS-Kommerzbank and, consequently, controlling equity in TAS-Investbank, as well as providing advice on various corporate and finance matters related to post-acquisition and provision of subordinated loan to TAS-Kommerzbank. The attorneys provided legal advice to Turkie Garanti Bankasi A. S. in connection with a secured loan to Marka Ukraine LLC; represented CEB in connection with granting secured loans to the Kuzminetsky Brick Factory; represented lead managers (Standard Bank Plc and BNP Paribas) in the issue of 100 million Eurobonds by Bank Pivdennyi; advised Deutsche Bank UK Bank Limited, with respect to provision of loans to JSC The State Export-Import Bank of Ukraine. The firm has been consistently active in providing legal advice to the EBRD and IFC on a number of their finance projects in Ukraine.

Magister & Partners’ banking and finance practice, which consists of 15 lawyers and is led by partner Olga Khoroshylova, enjoys a remarkable reputation. During the reported period the company’s legal practitioners represented Ukravtodor and the Ukrainian Ministry of Finance in obtaining a USD 465 million secured loan facility and acted as an advisor to Alfa-Bank in connection with the provision of a syndicated credit arranged by HSBC, Barclays Capital, Natixis and Bayerische Landesbank. In addition, Magister & Partners represented Ukrainian banks — Alfa-Bank, Nadra Bank, First Ukrainian International Bank in their lending by means of Eurobond issues as well as lead managers, for example ABN Amro and Credit Suisse in respect of Eurobonds by Ukrsotsbank.

Andriy Kravets & Partners specializes in providing legal advice in lending transactions, assets and commodity finance, corporate finance, pre-export finance, project finance, syndicated loan transactions, financial regulatory, insolvency and restructuring matters. The company’s clients include Citigroup, Deutsche Bank AG, Société Generalé, Calyon, Standard Bank Plc, Credit Suisse, ABN AMRO Bank N.V. in their financial transactions in Ukraine. The firm recently acted as the Ukrainian legal counsel to Calyon and Credit Suisse in a USD 300 million facility transaction arranged for one of the major industrial groups of Ukraine; advised Barclays Capital and Citibank N.A. London in a USD 187 million pre-export facility; the firm also recently provided legal services to JP Morgan and Citibank in their transaction connected with the provision of a USD 200 million bridge facility to a Ukrainian industrial group for further issue of Eurobonds. Andriy Kravets and Julia Samoylova are the firm’s leading experts in banking and finance.

Vasil Kisil & Partners advise on various aspects of ban king and financial transactions, including bank loan facilities, structured finance products, lease, asset and project finance, securitization, corporate bonds and other financial instruments. In 2007 the firm’s experts provided comprehensive transactional and regulatory support to SEB Group in acquiring the controlling stake in Factorial Bank; to Fitch Ratings — in the RMBS and auto loan securitization transactions of PrivatBank; Calyon; ING Bank Ukraine; PKO Bank S.A. (Poland), etc. Denis Lysenko, partner, is the firm’s key professional in this field; the firm’s associates, Anna Pushkaryova and Yulia Kyrpa, have also been recommended.

Volkov & Partners’ lawyers advised the Bank of Georgia, one of the leading Georgian banks, in an acquisition of the Ukrainian Bank of Development and Partnership. The role played by Volkov & Partners included review of contracts during transaction and passing through registration procedures at the National Bank of Ukraine. The legal team, which included Oleksiy Volkov, Roman Drozhanskyy and Volodymyr Belimov carried out due diligence of Ukrgazbank. Volkov & Partners have also advised on reputation risks assessment.

In 2007 the Kiev office of the international law firm Salans showed strong performance in the banking and finance area. Natalia Selyakova, head of the banking and finance practice group, and Oleg Batyuk, managing partner of the Kiev office, represented the international investment bank in connection with a USD 930 million loan facility to the State Service of Automobile Roads of Ukraine (Ukravtodor) secured by Ukrainian state guarantees; the mentioned group advised Anthousa Limited (Holding company Furshet) in the transaction to obtain a USD 90 million loan facility from the EBRD.

During 2007 Zamorska & Partners provided ongoing legal support to a number of leading European credit institutions and foreign banks. The firm’s expertise includes successful M&A deals for banking clients, general advice on banking regulatory requirements and Ukrainian currency control issues, bank transactions with securities and related tax implications, issue of legal opinions on lending projects, advice on securities arrangements and structures. The leading expert is Tatiana Zamorska, who for many years has been specializing in tax and legal auditing of the largest Ukrainian banks and subsidiaries of leading European banks as part of the international audit procedures carried out by the BIG-Four firms.

The Finance & Projects team of the Kiev office of DLA Piper Ukraine is headed by partner Oleksandr Kurdydyk. In 2007 the team advised UPEC industrial group in the sale of a 97.25% shareholding in the Ukrainian Factorial Bank to the Swedish financial group SEB. The team also advised the EBRD on several significant loans to Ukrainian companies; advised the Black Sea Trade and Development Bank on provision of a secured loan of USD 20 million to OJSC Galnaftogaz Ukraine, a Ukrainian gas filling station operator.

Konnov & Sozanovsky advises on the development of business framework, M&A issues, transactions with securities and other assets. It also advises on share purchase matters involving Ukrainian banks and on incorporation of new banks with foreign investments. The lawyers team headed by Sergei Konnov and Borys Lobovyk provide a full range of legal services to clients, like the registration and obtaining of necessary permits from the NBU; consulting on different types of security, including pledge, mortgage and bank guarantees.

Beiten Burkhardt representative banking and finance experience includes advising Ukrainian and foreign institutions, both commercial and investment on a number of transactions, as well as business activities and regulatory issues. The firm has a solid expertise on application of LMA standard documentation under Ukrainian law, currency controls and taxation of banking operations and other financial services. The firm advised an international banking holding on restructuring of the holding of banking subsidiaries and other assets in Ukraine, on outsourcing of non-core banking services to third parties, on development of the payments systems, a major European and US banks in connection with contemplated trade finance and derivative transactions. The firm also advises Ukrainian banks on operations in international capital markets, support their transactions with a foreign element. Beiten Burkhardt is especially proud of several comprehensive legal due diligence investigations carried out at major Ukrainian banks and overall support of acquisitions in the Ukrainian banking sector, with the latest being acquisition of a majority stake in Ukrainian Bank Forum by Commerzbank. Beiten Burkhardt banking and finance law practice group is co-headed by Marina Tegypko and Dr. Oleg Zagnitko.

The banking and finance area is a traditionally strong one of B.C. Toms & Co. The most notable deals in 2007 are as follows: advising a major Italian bank on its complex arrangements whereby a group of lenders/insurers are financing the construction of a steel facility for one of Ukraine’s largest corporate groups; acting for a major international bank on the financing of a hotel construction project in Kiev; legal counsel on Ukrainian law for a syndicate of major international banks lending to a major Ukrainian company; acting for a major international credit card network, including representing it at the National Bank of Ukraine; advising a major international tobacco company and a major bank on the implementation of their respective employment bonus plans in Ukraine. Experience in security for loans and trade finance transactions, as well as the use of derivatives are also worth noting. Bate Toms, Taras Dumych, Svitlana Petrenko and Anna Kvederis are leading lawyers of the firm.

The recent experience of the Kiev office of CMS Cameron McKenna includes advising HypoReal on its USD 140 million loan to finance the acquisition of the Globus shopping centre in Kiev; assistance to a leading European bank on its loan agreement for over EUR 75 million to refinance the construction of a major office building in Kiev; West LB in a USD 65 million corporate finance loan facility. Oleksiy Levenets, Adam Mycyk, Oleksiy Soshenko, Victoria Kaplan, Marianna Danylenko, Kateryna Chechulina, Vyacheslav Ovechkin are all engaged in related projects.

The performance of Chadbourne & Parke in 2007 was notable for its legal advice to the EBRD in connection with the USD 59 million loan financing to floorboard Maker Barlinek Invest and M&A transactions in the banking sector like the acquisition of Marine Transport Bank by Marfin Popular Bank and acquisition of Avtozazbank by Bank of Cyprus Group, where it assisted buyers. Jaroslawa Johnson, Sergiy Onishchenko, Oleg Mazur, Oksana Firsova, Dmytro Fedoruk, Olena Repkina, Yuriy Voytsitskyi and Natalya Kim are all experienced lawyers.

The Okhrimchuk Grushyn Khandurin law firm is quite a young but, nevertheless, very notable player in Ukraine. The firm’s lawyers advised foreign lenders, like lead managers BNP Paribas, ABN Amro, Deutsche Bank and ING within the auspices of a pre-export revolving term loan facility to Metinvest and BNP Paribas, which arranged syndicated USD 545 million loan facilities to SCM and arranged legal support to the DTEK group of companies in respect of obtaining a USD 100 million loan facility from a foreign investment bank. Andriy Grushyn and Mikhail Razuvaev are leading banking lawyers.

The Odessa-based ANK law firm has expanded its performance in the banking sector and in 2007 its legal practitioners Andrey Selyutin and Denis Stadnichenko advised Widenet Ltd in obtaining a EUR 9 million loan facility from Credit Europe Bank.

Financial law is one of the foreground practices of Lavrynovych & Partners. In 2007 the firm carried out a few large transactions, including legal support to Promsvyazbank, concerning credit granting USD 3 million. The firm’s partner Iryna Marushko is regarded as the main specialist in this particular field.

Gvozdiy & Oberkovych attorneys at law are experienced in due diligence and related pre-sale issues. This dimension of the firm’s practice was focused on assisting obtaining EUR 400 million loan facility to Ukrainian company by a Czech bank. Sergiy Oberkovych and international partner Gina Berg are the main practitioners in this field.

In 2007, Ernst & Young acted as a Ukrainian counsel for quite a number of banking transactions, including assistance in establishing a banking institution, performing due diligence, structuring advice and ongoing tax and legal support. Igor Chufarov, Albert Sych and Pavlo Moroz have a good reputation as an advisor on banking and financial law matters.

Gramatskiy & Partners has a great experience in the sphere of legal support in creating financial enterprises in Ukraine by international banking groups, establishment and activity of first-rate credit unions and non-government pension funds, including Credit union KS Volodar, First Pension Company and others. Alexander Koval and Igor Reutov gained a reputation as key specialists in the field of banking and financial law.

Lvov-based Pavlenko, Statsenko & Osinchuk showed remarkable performance in 2007. For example, the firm advised Concern Khlibprom in connection with a secured loan submitted by the International Finance Corporation.

The company Integrites regularly gives legal support to borrowers and customers. In financing transactions, the company supports its clients in preparing the credit documentation, structuring security packages and rendering legal opinions. In 2007 the firm advised IT company Datalux in obtaining a loan facility in the amount of USD 20 million and the Ukrainian-Estonian Joint Venture Ukrainian Eastern Fish Company Ltd. Olena Zaitseva is involved in loan matters.

The Kiev office of Deloitte is recognized as a leader in serving the financial services industry, including commercial banks, brokerage offices, investment funds and other Ukrainian financial companies. Vadim Voloschenko and Ilya Soykis, gained significant experience while consulting a leading international bank and investment companies. Deloitte’s experience in buy and sell side services related to the acquisitions of Ukrainian banks is notable for the tax and legal risks assessment and comprehensive legal support.

The banking and finance lawyers of Arzinger & Partners Inna Laska, Anna Pogrebna, Wolfram Rehbock possess many years of experience dealing with matters involving state, national and international banking, loan funding, securitization, project funding, bank lending and legal support of all kinds of bank transactions.