VAB Bank Bondholders Demand Payment on Missed September Coupon

A group of VAB Bank creditors demanded the Ukrainian bank pay a missed coupon on $125 million of bonds, according to a letter from the law firm advising the group.

The Kiev-based bank was due to pay about $2 million on Sept. 14, according to the letter obtained by Bloomberg News. Clifford Chance LLP represents the group of financial institutions and asset managers holding a “material portion” of the notes, according to the document.

VAB Bank Chairman Denys Maltsev said Oct. 2 the interest would be paid within “a week or two.” The payment hasn’t been made, according to the letter dated Nov. 7, which was addressed to Maltsev.

Calls and e-mails to the VAB Bank press officials seeking comment on the missed payment weren’t answered.

The letter was also sent to Nataliya Vasylyuk, chairwoman of VAB Bank’s supervisory board, Oleg Bakhmatyuk, the bank’s beneficial owner, and copied to Valeriia Gontareva, governor of the National Bank of Ukraine, Oleksandr Pysaruk, the first deputy governor of the central bank, the Cabinet of Ministers of Ukraine including Arseniy Yatsenyuk, the country’s prime minister and Petro Poroshenko, its president.

Jared Grubb, office managing partner for Clifford Chance in Ukraine, confirmed the letter had been sent on behalf of the group of bondholders. The bonds were restructured in May, Grubb said today by phone from Kiev.

The maturity was extended to June 2019 and the interest rate was lowered to 9 percent from 10.5 percent for the year through June 2015, Grubb said.

The group hasn’t received a response from VAB Bank, Grubb said.

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