News Brief No. 00/76

News Brief: Release of Third PricewaterhouseCoopers Report on the National Bank of Ukraine

September 1, 2000

The National Bank of Ukraine (NBU) has released the last of three reports from a special examination by PricewaterhouseCoopers (PwC) of the NBU's foreign reserves management. It covers the period January 31, 1998 to September 30, 1998. The NBU commissioned the report at the request of the IMF staff following various allegations that the NBU engaged in transactions that gave the impression that Ukraine's foreign exchange reserves were higher than was actually the case. The IMF has posted the PwC report on its website at www.imf.org where it will remain for one month, which follows the procedure for the first two reports (see IMF News Briefs Nos. 00/53 of July 10 and 00/26 of May 4, 2000). At the request of PwC, the report is available in a read-only version.

The third PwC report raises no significant issues in addition to those discussed in the first and second reports.

The IMF views very seriously any misreporting arising from overstating the level of reserves. The IMF's Executive Board is scheduled to meet on September 6 to decide whether Ukraine, by misreporting the level of its reserves in the periods covered by the PwC reports, breached its obligation to provide the Fund with accurate information under the Fund's Articles of Agreement or obtained disbursements under an IMF arrangement that it would not otherwise have received. Once a final determination on misreporting is made, the Executive Board will decide what remedial actions may be appropriate.