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KIEV, Dec 19 (Reuters) - Ukraine declared the country's largest lender PrivatBank insolvent on Monday and said bringing it under state ownership was the only way to protect the money of 20 million Ukrainian clients and stave off threats to the financial system.
The central bank said in a statement that PrivatBank had not fulfilled its recapitalisation programme and 97 percent of its corporate loans had gone to insiders. As of Dec 1, the bank's capital shortfall stood at 148 billion hryvnia ($5.65 billion).
"We are sure that moving the bank into state ownership is the only possible way to save the money of the bank's clients and to save the financial system," the central bank said in a statement.
$1 = 26.2100 hryvnias Reporting by Natalia Zinets and Pavel Polityuk; Writing by Matthias Williams