NBU to conduct stress testing of Ukrainian banks

MOSCOW. Dec 28 (Interfax) - The National Bank of Ukraine (NBU) will conduct the three-stage stress testing of 21 out of 61 banks operating in the country next year, Ukrainian media outlets said with a reference to the NBU's website.

"A total of 21 banking institutions making up over 90% of assets of the banking system will undergo stress testing in 2025. The banks were selected according to three criteria, such as the size of risk-weighted assets, the amount of deposits attracted from households, and the amount of net loans to households," the NBU said in a statement.

This list, in particular, includes five state-owned financial institutions, namely, PrivatBank, Oschadbank, Ukreximbank, Ukrgasbank, and Sense Bank.

The NBU will also assess the resilience of Raiffeisen Bank, Ukrsibbank, OTP Bank, Credit Agricole Bank, ProCredit Bank, Kredo Bank, Pravex Bank, the First Ukrainian International Bank, Pivdennyi Bank, TAScombank, Monobank, Bank Credit Dnipro, Vostok Bank, A-Bank, MTB Bank, and Bank Lviv in 2025.

As reported, the banking system resilience assessment in 2025 will include three stages, such as an asset quality review (AQR) as of January 1, 2025 by independent auditors, the extrapolation of AQR results for all banks, if necessary, and stress testing of the largest banks under the baseline and adverse macro-economic scenarios with a determination of the necessary levels of the capital adequacy ratio.

The results of the assessment will be published before December 31, 2025.

"The resumption of the standard annual resilience assessment is a step towards strengthening the finance sector's ability to resist existing and potential challenges and is stipulated in the agreements with our international partners, in particular, the Memorandum of Economic and Financial Policies signed with the IMF [International Monetary Fund] and the Ukraine Plan for the implementation of the EU's Ukraine Facility financial support program," the NBU said.