Today, on April 14, 2015, during a regular meeting held at the National Bank of Ukraine, representatives from the banking community concurred that the situation in the money market, including its foreign exchange segment had shown signs of stabilizing.
Governor of the National Bank of Ukraine Valeriia Gontareva noted: "There are grounds to say that equilibrium has been achieved in the foreign exchange market. The situation has remained stable in recent weeks. Therefore, the National Bank asserts that the prerequisites are in place for the market liberalization and relaxation of some restrictions. Thus, the National Bank of Ukraine has already abolished the requirement for banks to use the Letter of Credit method of payment to settle import transactions involving life-sustaining goods (oil, petrol, diesel fuel, pharmaceuticals for hemodialysis and oncology treatment, etc.) that are imported under direct contracts with producers, as well as military goods, effective from April 10, 2015.
According to First Deputy Governor of the National bank of Ukraine Oleksandr Pysaruk, the regulator will complete the cleaning up of the banking industry within two or three months. Once the clean-up exercise is completed, the regulator will shift its focus towards structural stabilization measures. "The regulator is working on a plan for the gradual removal of the exchange restrictions in accordance with its commitments under the new arrangement with the International Monetary Fund. In particular, all restrictions on withdrawing deposits imposed in в 2014 – 2015 will be phased out," he said.
Governor of the National Bank of Ukraine Valeriia Gontareva added that these measures by the regulator would help restore public confidence in banks and "reboot" the banking system.
She also brought to the attention of the attendees the monetary policy pursued the regulator and said that high inflation rates (the inflation rate stood at 10.8% in March, and 45% in annualized terms) forced the National Bank to remain the discount unchanged.
In addition, the bankers discussed amendments to the laws governing the banking industry. All the representatives from the banking industry welcomed Draft Law No 1195 On Amendments to Some Legislative Acts of Ukraine (with regard to the repayment terms for time deposits) that had been passed in first reading by the Verkhovna Rada of Ukraine. Deputy Governor of the National Bank of Ukraine Vladyslav Rashkovan expressed his confidence that this bill would soon be passed into law. "Banks will be able to manage their liquidity on a forward-looking basis and build up resources for lending to the economy," he emphasized.
Another relevant issue for the banking industry is strengthening the NBU’s institutional capacity and autonomy framework. The regulator's officials informed the meeting participants that the respective draft law allowing it to streamline the effectiveness of the NBU's governing bodies and prevent political interference into its activities would be tabled in the Parliament for consideration as early as this week.
At the conclusion of the meeting, Valeriia Gontareva unveiled plans for a Ukrainian delegation led by the Governor of the National Bank of Ukraine to participate in the Annual Meetings of the Boards of Governors of the IMF and the World Bank to be held on April 16-21, 2015. According to her, a series of important meetings with senior officials from the IMF and other international financial institutions providing support to our country will be held as part of the visit to discuss the macroeconomic situation in Ukraine and the clean-up of the banking sector.