New Insider procedure within the ProZorro.sale

Insider auction, one of its elements, is based on Dutch auction to facilitate the reform of the disposal of bank assets that are to be liquidated, started by the Deposit Guarantee Fund more than two years ago.

October 26, 2017

A new Insider procedure within the ProZorro.sale project was launched. The main peculiarity of the procedure is a brand-new auction type - Insider auction.

A three-stage Insider auction makes asset sales much faster, what is especially relevant for banks approaching their closing down deadlines. WIth introduction of the Insider procedure it becomes much more possible to sell assets that could not be sold for a long time.

The Ministry of Justice of Ukraine has approved the Decision of the Deposit Insurance Fund Executive Directorate on implementing the pilot project on asset sales using ProZorro.sale at decreasing price auctions. Insider auction is based on Dutch auction to facilitate the reform of the disposal of bank assets that are to be liquidated, started by the Deposit Guarantee Fund more than two years ago.

The major peculiarity of the Insider auction is that it is completed in one day. Assets are sold at a decreasing price that can fall down to 20 per cent from the starting point during the auction. Moreover, bidders are eligible to get registered for participation in an auction right on the day it is held.

As to the course of Insider auction, it consists of the three stages. During the first stage, Dutch auction proper, the price is being automatically lowered until one of the participants stops the decrease fixing a current price. At the second stage, Sealed bid, other participants can make higher bids than the fixed price is. During the last stage, Best bid, the participant who has fixed the price at the first stage will have a possibility to make a final increase and compete for a lot with the winner of a previous stage.