Oleksii Soboliev, project manager for ProZorro.Sale, in the column for Delo.UA, described how the system of selling property of bankrupt banks changed, whether it became more effective and what problems are still to be solved.
In February, the project ProZorro.Sale moved to a new level. If someone has not heard, we are engaged in selling property of bankrupt banks through the transparent electronic auctions run by the Deposit Guarantee Fund (DGF). And we can already say: the new system works, it is beneficial both for private companies and ordinary citizens.
The idea was to use the successful ProZorro system – designed to facilitate public procurement – to sell state assets. We strongly relied on the experience of the procurement reform, and therefore very quickly passed the path we launched the database only last fall and since February 1 all sales of the DGF go exclusively through our electronic system ProZorro.Sales. Of course, before that, we had tested the system for three months and all this time two systems were working in parallel: on the one hand, separate electronic exchanges, and on the other, platforms connected to a single central database ProZorro.Sale.
During this time, we managed to establish several records. In February 21, auctions took place on a single day, with the sold property amounting to about 15 million UAH. On the same day another record was set: an auction with as many as 14 participants was held, who were competing for the rights to the Chevrolet Lacetti SX car. Details of the lot and link to the auction are available here.
And now we have come to a very important news. Common citizens – physical persons participated in this record auction. This is possible from January of this year, when the DGF made appropriate changes to the regulations. What does this mean? The fact is that now anyone has the right to choose a suitable lot, take part in the auction, and buy a car or an apartment below a market value.
I will give just a few examples of such lots. The vehicle Nissan Maxima 2002, asking price – 3,6 thousand UAH. At the moment it is in Lutsk, where the car can be “tested” personally before the auction. Link to the lot. Or, for example, the car Toyota Corolla 2008, asking price of 82.5 thousand UAH. The car is in Kyiv, details (at the time of the material’s preparation the lot was already sold).
In addition, we collected and processed statistics from the pilot period (from November 2015 to January 2016 inclusive) and we can see how the effectiveness of the new transparent system looks compared to the work of the old auction system, towards which the market and the regulator had reservations. The presentation can be found here.
Let us start with general figures. About a third of all lots issued by the board of the fund for this period were published on the sites connected to ProZorro.Sale. If we talk about the effectiveness of trading, then 3% of all auctions announced at ProZorro.Sale concluded in sales, compared to 2.6% of auctions in exchanges. It looks like the buyers have a little more trust in the new transparent system. As this level of effectiveness does not match our goals, it needs to be raised considerably (we are working on it).
If you break the effectiveness down by asset type, it turns out that ProZorro sells at the level of exchanges (8% of the auctions held against 8.9%), but loans are almost twice as successful (2.1% against 1.2%)!
Another interesting consequence of the ProZorro.Sale introduction was an increase in price during the auctions. On average, the price grew by 17% in ProZorro.Sale, while on the exchanges – only by 4%. We believe that this is due to the unified auction module. The same effect of the price increase can be clearly observed in the top-10 auctions: almost half of the list is occupied by auctions on ProZorro.Sale.
The only notable difference is that the exchanges were able to sell larger assets.
What is next? The first results show that the transition to the new system was successful. Clients did not run away, and in some cases even began to pay more for state assets (what we intended). What exactly we need to work on is how to improve the effectiveness of auctions and attract new customers. The January decision by the DGF on the admission of all (both legal entities and individuals) to the purchase of any assets of the Fund should contribute to this.
You can buy assets using the tab “interesting lots” on the website www.prozorro.sale, and follow the sales statistics – through the module of business analytics bi.prozorro.sale
The news on the project, as always, can be found in my annual updates on Facebook, and recently – in the “News” section on the official website of the project. And we will have more good news.
The column of the project manager Prozorro.Sale Oleksii Soboliev on Delo.ua