Banking sector of Ukraine

According to the information posted on the official website of the National Bank of Ukraine in 2014 the banking sector increased its profit by 210.200.000 hryvnia which is 24.5% more than in 2013. Costs reached the level of 263.200.000 hryvnia (57.2%).

NBU concludes, that the negative financial results of the banking sector in Ukraine in 2014 occurred due to increase in allocations to reserves for potential losses from active operations.

40% of the losses were formed by banks which are classified as insolvent, and in which the temporary administration has entered. It is important to note the fact, that the basic banking operations remained profitable.

Refinancing in the amount of 101.000.000 hryvnia was received by 34 banks.

The most reliable banks of Ukraine 2014-2015 (according to the NBU)

Bank

Form of ownership

1

Ukreximbank

state

2

Oschadbank

state

3

Credit Agricole Bank

private

4

Ukrsotsbank

private

5

Raiffeisen Bank Aval

private

6

Privatbank

private

7

Ukrsibbank

private

8

OTP Bank

private

9

Ukrgasbank

state

10

PUMB

private

 

The largest banks by asset size (thousand UAH.) (according to the NBU)

 

Bank

Assets

Loans

Other assets

1

Privatbank

201 900 469

150 422 913

13 174 777

2

Ukreximbank

131 527 353

51 088 244

525 152

3

Oschadbank

113 681 582

64 799 635

111 082

4

Delta Bank

63 104 973

46 234 276

698 571

5

Prominvestbank

51 578 338

37 095 781

651 515

6

Ukrsotsbank

44 960 154

30 831 650

181 225

7

Raiffeisen Bank Aval

44 675 795

28 447 665

552 034

8

Sberbank Rossii

43 379 430

34 691 748

127 249

9

PUMB

37 945 867

24 419 083

114 041

10

Alfa-Bank

37 381 829

23 485 371

1 564 827

 

According to the Ministry of Finance of Ukraine as at 09.02.2015 there are 38 problematic banks. (http://minfin.com.ua/banks/problem/)

 

The International Monetary Fund has provided some basic criteria to improve and stabilize the banking sector in Ukraine:

- monitoring and support of liquidity;

- review and improvement of regulatory policy and banking supervision;

- restructuring and recapitalization of banks;

- assessment of the financial stability of banks;

-removal of restrictions and increase of the ability of banks to address the issue of bad loans.

According to the decision of the NBU Board of 01.12.2014 №758 «On settlement of the situation in the monetary and foreign exchange markets of Ukraine» restrictions on foreign currency transactions until 03.03.2015 were extended. Among the restrictions on foreign investment issues, it is necessary to highlight the ban on the withdrawal of currency from Ukraine, received from the sale of corporate rights of Ukrainian companies or securities of Ukrainian issuers outside the stock exchange by foreign investor, as well as currency received in the form of dividends. Regulator is using administrative methods in order to compensate substantial decline in foreign investments.

To summarize, in general, the banking sector has undergone optimization: new legislation came into force, policy of the central regulator (NBU) has become more rigid, the IMF provides active financial injections into the banking system of Ukraine.