Banking in Ukraine

The history of banking in Ukraine since Ukrainian independence in 1991 has seen since the late 2000s several periods of bank mergers and acquisitions of different natures.[1] Early 2016 117 banks were operating in Ukraine, their assets amounted to 1.254 trillion Ukrainian hryvnia.[2]

History

In the years before the 2008–09 Ukrainian financial crisis stakes in Ukrainian banks were mostly acquired by foreign firms who had great hopes that the Ukrainian economy and banking system would soon start to grow rapidly and had (thanks to the flourishing economy prior to the financial crisis of 2007–08) money to invest in Ukraine and lend out.[1] The new owners often bought banks at prices that were five to seven times above their actual value and (the banks they bought) had often a low quality of assets.[1]

During the presidency of Viktor Yanukovych (from February 2010 until his removal from power in February 2014) the mostly foreigners bank owners lost their hope in the prospects of the Ukrainian economy and banking system under the then Azarov Government.[1] Bank owners sold their assets to Ukrainian businessmen close to the government.[1] These new owners averagely paid 0.5-1.0 of the bank’s value.[1]

After the February 2014 Ukrainian revolution and due to the War in Donbass Ukraine's economy shrank 6.8% in 2014[3] and mergers and acquisitions of banks came to a standstill.[1] From early 2014 till November 2015 the National Bank of Ukraine declared 62 (Ukrainian) banks insolvent.[4] Early 2016 117 banks were operating in Ukraine with assets amounting to 1.254 trillion Ukrainian hryvnia.[2] By August 2016 8 (more) financial institutions had been declared insolvent.[5] Since July 2015 foreign firms have start to by Ukrainian banks again.[1] On 17 December 2016 the National Bank of Ukraine withdrew the banking license of Finance and Credit and liquidated the bank.[6] On 1 July 2015, in terms of total assets, this was this bank placed 10th in the top 15 of largest commercial banks in Ukraine.[7]

All Ukraine's banks combined, excluding insolvent banks, posted a loss of 66.6 billion hryvnia in 2015.[8] 71 banks ended 2015 with profit amounting to 5.2 Hryvnia.[8]

See also

References

External links


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