Ukrainian President Moves to Oust Central Bank Chief

Ukrainian President Petro Poroshenko moved to assert his power, picking a new central bank chief, foreign minister and chief prosecutor.

Poroshenko, who took office less than two weeks ago, nominated Valeriya Gontareva to replace Stepan Kubiv as the head of the monetary authority, Pavlo Klimkin to succeed Andriy Deshchytsia as the country’s chief diplomat and Vitali Yarema to take over from Oleh Makhnitsky to lead the prosecutor’s office, according to parliament’s website. There’s no date set for lawmakers to vote on the proposals.

Gontareva, 49, is set to become the first woman to run the central bank after serving as the chairman of Kiev-based Investment Capital Ukraine. She would replace Kubiv, 52, who was picked by parliament in February for seven years after three-months of deadly protests ousted Kremlin-backed President Viktor Yanukovych. Poroshenko did not provide reasons for changes.

She will share stewardship of an imploding economy and a financial system under pressure as government forces battle separatist unrest in the country’s easternmost regions. Ukraine is relying on a $17 billion bailout loan to stay afloat after the hryvnia plunged 31 percent against the dollar, while the nation’s biggest 22 lenders may require fresh capital of as much as 5 percent of gross domestic product.

Klimkin will take over the Foreign Ministry after the outgoing chief riled Russian diplomats by using derogatory language to refer to Russian President Vladimir Putin.

‘Right Direction’

Poroshenko “is taking steps in the right direction to gain power and to get more leeway in domestic and foreign policy,” Stefan Meister, a Berlin-based analyst at the European Council on Foreign Relations, said by phone. “It looks good for the time being, or better than before.”

Ukraine’s government bonds due 2023 rose for the first time since June 9, pushing the yield down to 9.012 percent, data compiled by Bloomberg show. The hryvnia declined to 11.965 per dollar as of 2:45 p.m. from 11.94 yesterday.

Gontareva is “knowledgeable, experienced banker with commercial background,” said Vladislav Sochinsky, the treasurer at Citigroup Inc.’s unit in Kiev. “But we already have the third central bank head in just four months, while this is seven-year position.”

Aside from the central bank governor, foreign minister and prosecutor general, Ukraine’s president also has the right to pick the head of the state security service and the defense minister.

Before it's here, it's on the Bloomberg Terminal.