As part of the efforts to expand cooperation between the National Bank of Ukraine and the European Central Bank, on July 14 – 15, 2015 a joint seminar was held in Kyiv, which became a platform for determining priority and topical areas of further interaction between the National Bank and the European Central Bank.

In his opening speech, Director of the NBU international relations Department Sergiy Kruglyk welcomed the workshop participants and pointed out that the first seminar held jointly with the European Central Bank is a milestone event in the development of international banking relations. “By holding these events, we pave the way for further efficient cooperation, in particular, due to  raising mutual awareness and exchange of experience with regard to approaches to the institutional set-up of central banking in the euro area and in Ukraine,” noted Sergiy Kruglyk.

During the workshop, the experts from the National Bank of Ukraine briefed their colleagues from the European Central Bank and the Deutsche Bundesbank about the NBU institutional set-up, recent changes and transformations that the National Bank of Ukraine is going through, as well as the measures undertaken to strengthen its autonomy framework.

According to Sergiy Kruglyk, it is symbolic that the first workshop is being held in Kyiv, the city that has decisively demonstrated to the whole world that Ukraine has irreversibly entered the path to the European integration and its commitment to the European Union values.  However, the present-day stage in the development of Ukraine in the context of stronger Eurointegration processes unfolding in Ukraine call for new forms of cooperation, reflecting the need to forge closer ties with the European peers. 

In his turn, Mr Michael Sturm, a representative from the European Central Bank, pointed out that in order to achieve macroeconomic stability and overall welfare it is necessary to ensure the independence of the central bank, which implies institutional, personal, functional and financial independence of the regulator.

Last year Ukraine   and the European Union signed the Association Agreement, which is crucial for the political and economic development of our country.   The Eurointegration process is conditioned on how the economy is doing, the country’s ability to compete on the EU market, and price stability.   The European integration hinges on the cooperation between the National Bank of Ukraine and the European Central Bank in terms of drawing on experience in the area of banking regulation, organizational and legal support of banking relations, counteraction to corruption, and joint fight against financial abuse.

“Today Ukraine more than ever needs support in implementing economic reforms and shaping the public administration system based on the European principles, – said Sergiy Kruglyk. – The stable banking and financial systems are the basis for further changes. Much efforts are required to align domestic laws, rules, and regulations with the European and international standards, in particular, efforts to harmonize domestic banking laws with the EU laws.

Speaking about the National Bank of Ukraine, Sergiy Kruglyk underlined that the NBU institutional set-up is based on the European principles, including with regards to the independence of the regulator.  He put a special emphasis on the economic, and political dimensions of the autonomy framework of the central bank that embraces institutional, personal, functional and financial independence of the central bank. The economic independence of the central bank is determined by the central bank’s ability to control its own budget, distribute profits, i.e. be economically independent.  The independence of political influence is ensured by the rules of procedure governing the appointment of the central bank’s Governor and its Board members, as well as the duration of their tenure and the methods the central bank applies when performing its core task – the retention of price stability.

The transformation changes that are taking place at the National Bank of Ukraine are based on the experience drawn from the functioning of the central banks in the EU, and contribute to making Ukraine’s central bank more efficient, including when it comes to the decision-making process.

“Our strategic aim is to build a strong and effective banking system, – concluded Sergiy Kruglyk. –One of our top priorities is to move ahead with institutional reforms in what relates to the functioning of the country’s central bank, which would enable the central bank to gradually shift to the policy consistent with the EU standards”.