On October 8, 2015, the Board of the National Bank of Ukraine issued Resolution No. 683 amending Instruction No.368.

By virtue of the Resolution, a new approach to the calculation of credit risk ratios has been adopted: 

• it is envisaged that assets shall be included in calculation of credit risk ratios at their book value.  This will allow banks to reduce the value of asset-side operations by the amount of provisions set aside against these operations. This will have a positive effect on credit risk ratios, thus  enabling banks to channel the released funds toward lending;
• the terms and conditions for cash collateral (coverage) against guarantees and letters of credit issued to be factored in to reduce credit risk have been set out, thus enabling banks to expand the use of such financial instruments if the cash collateral against them is available.

The Resolution has also specified the methodology for calculating the Regulatory capital adequacy ratio (R2):

the group of risk-free assets have been expanded to include assets secured by the state guarantee, which would facilitate the implementation of national programs through the funding of investment and infrastructure projects; .

index-linked domestic government bonds shall be included in calculation of the total  open foreign exchange position in an effort to apply a uniform approach to the  measurement of foreign exchange risks in the calculation of both limits of the open foreign exchange position and the Regulatory capital adequacy ratio (R2).

In addition, the resolution provides for the following:

• a shift in the rules governing the inclusion of subordinated debt, inter alia, the provision regarding the suspension of interest payment in case of a deterioration in the financial standing of a bank, which would contribute to the investment attractiveness and facilitate additional capitalization of the banking system.
• to devolve powers to an authorized person of the National Bank of Ukraine to take decisions on issues that used to fall within the competence of the Committee on Banking Supervision, which would streamline and speed up the relevant procedures.

Resolution shall take effect 31 day after the date  of its official publication, i. e. from November 11, 2015.