Ukrainian Clearing House

The guarantee fee as a means of ensuring the fulfillment of obligations under the concluded forward may be secured by providing a bank guarantee in accordance with the procedure established by the Regulations for conducting clearing activities in the direction of "Untreated timber and lumber" (hereinafter referred to as the Regulations), in the amount determined taking into account the risk group to which clearing participant is assigned, as of the date and time of submitting the purchase application, namely:

for risk group A – in the amount of 70% of the amount of the corresponding guarantee fee;
for risk group B – in the amount of 50% of the amount of the corresponding guarantee fee;
for risk group C – in the amount of 40% of the amount of the corresponding guarantee fee;
for risk group D – in the amount of 30% of the amount of the corresponding guarantee fee;
for risk group E – in the amount of 20% of the amount of the corresponding guarantee fee.

Bank guarantees must be issued by accredited guarantor banks in the form specified in the Regulations.

Procedure of Bank accreditation available via the link.

Banks accreditation

Accreditation grants the bank the status of an accredited guarantor bank and the right to issue bank guarantees, which the UCH accepts as security for the fulfillment of the obligations of clearing participants to pay the guarantee fee for concluded forwards based on the results of exchange trades for the sale of untreated timber/firewood. The list of accredited banks is published on the UCH website with the dates of acquisition and termination of the status.

Key requirements to the Bank

Bank must meet all of the above criteria and maintain compliance throughout the duration of its status:

Current Bank License;
either the state share in the authorized capital >75%, or a long-term credit rating on the national scale not lower than "uaAA"; for banks of foreign groups in the absence of a national rating – the parent group rating from Fitch/Moody's/S&P class A or higher;
absence of sanctions against the bank and/or owners of significant participation from Ukraine, the USA or EU countries;
impeccable business reputation of managers and owners of significant participation;
no confirmed cases of unjustified refusal to fulfill the reasonable requirements of the UCH under guarantees or other unfulfilled contractual obligations to the UCH over the last 12 months (disputed/settled cases may be considered individually).

UCH carries out an initial inspection and periodic monitoring (at least once a year or if there are signs of deterioration in the financial situation). Based on the monitoring results, the Supervisory Board may change the bank's overall limit in accordance with the internal Policy. The bank is informed about changes in the limit no later than the next business day.

Package of documents

Statement of intent to cooperate.
Bank Application (form — Annex 1 to the Procedure).
Documents confirming compliance with the requirements of Section II of the Procedure (if available).
Latest available SREP assessment.
Commercial offer for a banking product (bank guarantee), which should include: general terms, requirements for applicants, procedure and terms of consideration, collateral, commissions, other parameters, contact details for consultations.

In case of changes in the submitted data/documents, the bank submits an update within 3 business days. All materials are submitted in electronic form with the QES to the address: guarantee@uaclearing.com.ua.

Acquisition of status and validity of guarantees

The status of an accredited guarantor bank is granted from the moment of signing the Cooperation Agreement.
The next business day, UCH enters the bank into the List of accredited guarantor banks on the website and sets the total limit in accordance with the Policy; the bank additionally receives a notification with information about the limit.
UCH accepts bank guarantees (in the form from Appendix 1 to the Regulations) no earlier than the next business day after signing the Agreement; the date of commencement of the guarantee cannot precede the date of acquisition of the status.

Guarranty registration and use

After receiving the bank guarantee, the clearing participant sends it to the UCH for registration. The bank guarantee must be registered with the UCH before participating in the trade using such guarantee.

Please note! A bank guarantee can be used to cover the guarantee fee for a concluded forward, provided that its validity period expires no earlier than 45 (forty-five) calendar days after the last day of the forward execution period.

How to apply for registration and processing times

Before contacting an accredited bank, inform the UCH of your intention to use the guarantee (bank name and your code) on guarantee@uaclearing.com.ua. If the bank runs out of limit, we will inform you about it.
Upon receipt, send the guarantee electronically to the same address. The guarantor bank also informs the UCH about the guarantee on the day of issuance.
UCH makes a decision on acceptance/rejection no later than the next business day and displays the information in the clearing accounting system.

One bank guarantee can be used to cover several guarantee deposits, provided that the guarantee amount is sufficient.

The clearing participant may initiate the replacement of previously provided funds as a guarantee fee for a concluded forward with a bank guarantee during the entire term of the guarantee fee blocking operation in the amount of 50% of the total guarantee fee amount.