NBU cuts frequency of tenders for one-year refinancing from daily to weekly ones

KYIV. April 18 (Interfax-Ukraine) - The National Bank of Ukraine (NBU) will hold tenders for refinancing for up to a year once a week, namely, every Friday instead of every day as before, the regulator's press service said.

"If in the first days after February 24 the demand from banks for liquidity support was significant, now they, on the contrary, repay borrowed refinancing loans ahead of schedule. Given this, the National Bank has decided to cut the frequency of tenders for the provision of refinancing up to one year," NBU Deputy Governor Yuriy Heletiy is quoted by the press service as saying.

If necessary, the National Bank may announce tenders on granting refinancing loans on other days of the week, it said.

The NBU noted that the banking system has passed the "crash test" well and remains stable.

Since February 24, the liquidity of the banking system has increased by more than 50 billion hryvnia and now exceeds 200 billion hryvnia, it said.

"This volume of liquidity allows banks to actively support their customers' operations within available funds and provide the loan support important for the economic recovery," the regulator said.

As reported, the NBU on February 24 announced the implementation of blank refinancing of banks to maintain liquidity for up to a year with the possibility of prolongation for another year, while previously their term was limited to 28 days. Although in recent weeks, these loans are attracted by banks on the security of the pool of assets.

The interest rate on them is 11% per annum, while deposit certificates are placed at 9% per annum.

In total, since February 24, the National Bank has provided liquidity support for a year totaling more than 70 billion hryvnia, but in recent weeks the volume is low, in particular, in the week before last it fell to 0.7 billion hryvnia.