The Ukrainian banking sector in war times
Together with the Institute for Economic Research and Policy Consulting, the Centre for Economic Strategy, and the German Economic Team organised an expert discussion on Ukraine’s banking sector based on our joint Banking Sector Monitor.
Ukraine’s banking sector benefits from past reforms originating from before the beginning of the war and has shown remarkable robustness. This is also reflected in relevant indicators, such as the capital adequacy ratio, which reached 21% (risk-weighted assets) before the war and was therefore well above a few EU neighbourhood countries. As a result, the sector was well prepared for the crisis. In addition, the National Bank has been implementing decisive emergency measures at different episodes since the beginning of the war. No bank runs have occurred. Even more the sector is experiencing liquidity levels that are far exceeding required ones and the sector continues to serve as a backbone of the economy.
However, large liquidity reserves are also a sign of low lending to the real economy, which is crucial for economic recovery. So, how can Ukraine’s banking sector balance these requirements? We had the pleasure to discuss this question with an engaged expert panel.
The full Monitor can be downloaded here.
