The massive clean-up of the system, which cumulated in the nationalisation of PrivatBank, seems now largely to be over. The number of banks – currently 75 – is quite stable. Reforms improving the corporate governance of state banks and the supervision of the non-banking sector (the “split law”) have been enacted, which is a positive sign.
However, risks remain. The still high level of NPLs (53% of gross loans, in particular concentrated in state banks) needs to be addressed. Furthermore, recent events that threaten the nationalisation of PrivatBank raise new question marks, as this was considered the key cornerstone of the whole banking sector reform.