NBU head counts on good news regarding Ukrainian state-owned banks' privatization in 2025
MOSCOW. Oct 17 (Interfax) - Since Ukraine's banking system is in sound shape, investments in the sector, including in state-owned banks, may resume in 2025 if the country manages to maintain its macro-financial stability and predictable fiscal policy and, what counts most, mitigate security risks, National Bank of Ukraine (NBU) Governor Andrei Pyshny said.
"I hope that the bill on the privatization of state-owned banks passed by the parliament will still be able to create additional conditions and offer room for dialogue with private banks. Under the memorandum with the [International Monetary Fund] IMF, Sense Bank and Ukrgasbank are two priority banks for starting the privatization process involving a consultant, who will have choose the best options. Therefore, I hope that the year of 2025 will bring good news," Pyshny said in an interview with Ukrainian media.
The NBU's recent resilience assessment has confirmed that all banks are operating normally.
"We passed the crucial phase of transition to the new capital structure 'on soft paws', so to speak. The banking system's operations are profitable, boosting appetite for loans. The share of revenue from lending in banks' total revenue is growing," he said.
Along with the banks' operation sustainability, the growth of the loan portfolio by 20% a year shows that the banking system may indeed hold appeal for investments, he said.
Pyshny listed the continuing crisis and unpredictable tax policy among the main hurdles to investments.
"If the Ukrainian authorities make a statement on 2023 that hiking the profit tax for banks to 50% is an emergency and exception measure, but then replicate this decision, it makes communication with investors in the banking sector much more difficult," he said.
When commenting on a decrease in the number of financial market players from 67 to 62 over the past two years, Pyshny said that these banks left the market for various reasons, which pose no threat.
"The National Bank had to remove some banks from the market due to their insolvency. We also had two instances of license revocation and banks' closure because of systemic violations of financial monitoring requirements," he said.
Another reason is individual banks' reconsideration of their further prospects during communication with the NBU as part of the SREP procedure for evaluating their state, he said. These banks voluntarily decided to hand in their license.
"What we are having is a dialogue rather than any directive form of communication. Meanwhile, it is the shareholders who make a decision. The first example of that is Alpari Bank's decision to give away its license. And, in all likelihood, this is not the last such instance," Pyshny said.
