22 October 2018
National Bank of Ukraine prepared and published for public discussion the draft
White Paper “The Future of Regulating the Non-Bank Financial Sector regulation”
in which presented its vision of a new regulatory framework for the non-bank
financial sector. This document outlines the NBU’s
approaches to market segmentation, licensing, prudential supervision,
reporting, inspections, corporate governance and consumer rights protection.
The NBU will be responsible for a significant
part of the non-bank financial market if the Parliament adopts the Draft Law
of Ukraine On Amendments to Certain Laws of Ukraine On the Consolidation of
Functions of the State Regulation of Financial Markets No. 2431a which was
already supported by the Verkhovna Rada Committee on
Financial Policy and Banking and recommended for adoption in second reading.
New regulation framework is proposed for
insurance companies, credit unions, pawnshops, leasing and factoring companies
and other financial companies that perform currency exchange, money transfer,
provide funds as loans, provide guarantees, etc.
“As a potential regulator of a part of the
non-bank financial market after the split of functions of the National
Financial Services Commission, we demonstrate transparency and partnership to
its participants and are ready to work together to ensure more efficient market
operation. The draft law envisages 12
months of transitional period, during which the current regulation will be in
force and the National Financial Services Commission will operate as usual.
During this period, we will develop, discuss and improve new market regulations
with market participants and get prepared to take over responsibilities. We are ready for dialogue with the market and
to share our vision of a new regulatory model. As soon as this week we will
invite key actors, associations and experts to the first working meeting on
this topic”, - commented the finalization of White Paper the NBU First Deputy
Governor Kateryna Rozhkova.
The regulatory model has two main objectives: to
find new growth areas for each segment of the non-bank financial market and the
maximum protection of financial services consumers. The project takes into account the high
segmentation and heterogeneity of actors on these markets, both in size and
type of products and services. It offers the most flexible approach to non-bank
financial institutions licensing, reporting and supervision.
“The main innovation for market participants
will be a risk-oriented approach, which we have been successfully applying for
the third year in the banking market. It will make it possible to forecast
problems in companies and take preventive measures, rather than react when the
company becomes insolvent. We are also focused on the introduction of corporate
governance standards that will improve companies
performance, and consumer rights protection,” said Kateryna
The NBU is convinced that the new
model of regulation of non-bank financial institutions should be aimed at
achieving the efficiency and transparency of the market, as well as at bringing
non-bank financial services received by Ukrainian consumers closer to the best
Regulatory guidance in the draft White Paper has
been developed by a working group of the NBU, together with USAID’s Transformation
of the Financial Sector project experts.
The draft regulatory model is available at link. Please, send your comments on the draft
document at: NBFI@bank.gov.ua before 22 November 2018.