UAH 581 million in losses: director of Kyiv City State Administration’s finance department suspected over issuance of municipal bonds
The Kyiv City Prosecutor's Office says that in 2020–2023 the city did not need to borrow — because of the bond issuance the capital allegedly overpaid UAH 581 million. We explain what exactly is happening and why this matters for Kyiv's budgetary priorities.
By Tetiana Suchkova-Ladik
January 23, 2026 · 2 min read
The case in brief
The Kyiv City Prosecutor's Office has announced suspicion of the director of the Finance Department of the Kyiv City State Administration (KCSA) on grounds of official negligence. According to the investigation, in 2020–2023 the official approved the issuance of municipal bonds, although investigators claim there was no need to borrow — budget revenues allegedly exceeded expenditures.
According to the case file, the total amount borrowed through these issuances was nearly UAH 2.6 billion, and the metropolitan budget's losses from interest and related payments amounted to UAH 581 million (according to an expert examination). On 23 January, searches were conducted as part of the investigation in the official's offices and at his place of residence.
Positions of the parties
"Thus he borrowed almost UAH 2.6 billion for the city budget at interest, despite the fact that the city budget had no need for loans, since revenues exceeded expenditures. As a result of paying interest and other fees to service the loan, the metropolitan budget's losses amount to UAH 581 million, which was established by the conducted expert examination."
— Kyiv City Prosecutor's Office
"The Finance Department stresses that it acted strictly within budget law and implemented a decision adopted by the Kyiv City Council, which is mandatory to execute."
— Finance Department of the Kyiv City State Administration
Why this matters
This is not just a legal story — it is a question of managing public funds. UAH 581 million, according to investigators, went to servicing the debt instead of infrastructure or social spending. Even if the decision was adopted by the city council, responsibility for assessing the financial advisability lies with the officials who prepare and implement such decisions.
At the same time, municipal bonds are a common tool for financing large projects. In 2021 the KCSA planned a bond issuance of UAH 1.1 billion specifically for infrastructure development. The key question is whether these issuances were economically justified and whether they met their investment objectives.
What’s next
A pretrial investigation is ongoing; possible consequences range from criminal liability for the official to political demands to tighten financial oversight in the city council. For Kyiv residents it is important to follow the decisions rather than the headlines: will the results of the expert examination and the investigation be translated into changes in procedures, accountability and transparent borrowing criteria.
The question remains open: will this case become a precedent for tougher financial discipline in the capital — and how will that affect Kyiv's ability to attract funds for large projects?
