web site authorization

Authorization at www.stockworld.com.ua expands your access to web site functions: you may comment publications, organize meetings, participate in events, create personal profile, and view profiles of other registered users
You may use your profile in social networks to authorize on our web site. You automatically accept terms of Web site rules, and Rules of copying and other use of web site materials
You may use your profile in social networks to register on our web site :
03.12.2018 | 12:07
481
0

Ukraine is in top three countries by frequency of systemic banking crises

The NBU presented Macroprudential Policy Strategy

The National Bank of Ukraine has presented the Macroprudential Policy Strategy.

It was reported by the NBU. 

The document provides the NBU’s prospective actions to ensure financial stability as sustainable economic growth requires.

The Strategy lays the groundwork for implementation of a systemic macroprudential policy in Ukraine and explains the policy to the public, thus ensuring the transparency and clarity of the policy and its effectiveness in achieving financial stability.

Facilitating financial stability comes as the NBU’s next most important function (second in priority to maintaining price stability) under the Law On the National Bank of Ukraine as amended in mid-2015.

With the purpose to fulfill that function effectively, the National Bank has developed a macroprudential policy system that is necessary to prevent systemic risks from accumulating in the financial sector and improve its resilience to recessionary processes. 

The NBU takes responsibility to implement the macroprudential policy along with the monetary policy that aims to achieve and maintain low inflation.

Unlike those of banking supervision, macroprudential policy instruments are applied to the whole of the financial system or to its individual groups and participants.

The introduction of macroprudential policy in Ukraine comes as a requisite measure to strengthen the financial system’s protection from potential crises.

Having survived three systemic banking crises in the past 20 years, Ukraine is in the top three countries by their frequency.

The last of the crises, which came in 2014–2016, cost the nation nearly 40% of GDP.

The consequences laid severe restrictions on bank lending and economic growth.

It shows that ineffective regulation of the financial sector – both at the level of individual financial institutions and at the level of the entire system – comes at a price.

Based on the recommendations made by the European Systemic Risk Board and the specific nature of the Ukrainian financial system, the strategy sets six interim goals: preventing excessive growth in lending; preventing the liquidity gap from widening; preventing risk concentration; limiting the influence of distorted incentive; enhancing the soundness of financial infrastructure; decreasing the dollarization level in the sector.

The strategy provides in details the steps the National Bank will take to achieve its interim goals, beginning from identifying systemic risks and choosing, calibrating and activating macroprudential tools and ending with evaluating their influence on a given situation and deciding whether or not to continue applying them. 

References in the article: crisis, banks, nbu
If you see an error on our site, select it and press Ctrl+Enter
Comment0
To post a comment you should Enter or Register.
Last news in section: