In recent times, the National Bank has not used liquidity adjustment mechanisms that allow for the possibility for banks to apply for refinancing at their own initiative and/or for decisions to be approved on an individual basis. Instead, the central bank uses only standard monetary policy tools that include the following:

• overnight standing facilities available to banks on a daily basis, through which any bank that has holdings of government securities may be automatically granted an overnight loan against these securities as collateral in an amount of not more than 70% of the mandatory reserves made by the bank in accordance with the established required reserve ratios and kept in its correspondent account with the National Bank of Ukraine in the previous provisioning period under report;
• weekly refinancing tenders with a maturity of up to 14 days and of up to 90 days. The schedule for refinancing tenders is communicated to banks at the start of the year. Presently, refinancing loans are provided against collateral of government securities. Participation in tender procedures is open on equal terms to all banks.

The National Bank of Ukraine publishes information on these operations on its official website, including information on the amount of funds granted, number of banks that have received liquidity support, an interest rate and the loan use term.

It should be noted that if banks have sufficient liquidity, they do not need to apply for refinancing. In this case, they do not submit bids to participate in weekly refinancing tenders. In particular, no bank submitted bids to participate in the tenders with a maturity of up 14 days that were due to take place on August 6 and July 30. Refinancing loans worth UAH 878 million were provided to banks through the tender that was held on July 23.

With regard to tenders with a maturity of up to 90 days, they take place once a month. In particular, on August 13, refinancing loans worth UAH 2,634 million were provided to banks through this tender, whereas through the previous tender held on July 16 banks received UAH 236 million worth of refinancing loans. 

Speaking in the Verkhovna Rada this week, Governor of the National Bank of Ukraine Valeriia Gontareva said that the National Bank had not provided refinancing loans through any other mechanism. Thus, in particular, new stabilizations loans have not been provided to banks, and the terms and conditions attached to the loans previously granted have not been altered.

The Regulation on the provision by the National Bank of loans to banks to support their liquidity (approved by NBU Board Resolution No. 91, dated February 25, 2014) has been repealed by NBU Board Resolution No. 318, dated May 28, 2014. The National Bank used the above-mentioned mechanism only during the turmoil in the money market. When the situation reversed, its further use was deemed inexpedient.