Regular version of site
Skip to content
Ukraine's Financial Stronghold: NBU Unveils New Strategy Focused on Re-sisting russia’s Aggression and Rebuilding Ukraine

Ukraine's Financial Stronghold: NBU Unveils New Strategy Focused on Re-sisting russia’s Aggression and Rebuilding Ukraine

The National Bank of Ukraine has been one of the first public institutions to develop a new institutional strategy. This document takes into account the russian invasion’s impact on the Ukrainian financial system’s operating conditions and is focused on safeguarding Ukraine’s financial stability and reconstructing the country itself.

New strategic idea

The NBU has the capability, under any conditions, to pursue its mandate and galvanize the efforts of the financial ecosystem’s key participants to maintain financial stability, strengthen Ukraine’s potential, and ensure financial inclusion of Ukrainians.

At the same time, significant uncertainty and volatility inherent in current conditions require flexible planning and action to enable a faster and more effective response to changes.

Therefore, having been implemented for two years, the NBU Strategy until 2025 has been replaced by a new version, one that will enable the central bank to take account of external factors, expand the zone of certainty, and form alternative action plans for various developments.

“Four hundred fifty three days into the full-scale war, the financial sector and central bank have been holding the financial frontline. Over this time, we have managed to evolve, think ahead, and move the country forward. We have our own sector of responsibility. Acting within our purview, we must ensure that Ukrainians have confidence in financial stability, the Ukrainian government, the military, financial market participants, and international partners. All those who in any way depend on the NBU’s effective operation should feel that within the bounds of our authority, we are safeguarding their finances as passionately as the Armed Forces are defending all of Ukraine,” said NBU Governor Andriy Pyshnyy.

Comprehensive work on the new Strategy began in January 2023, he said. In relatively short order, the central bank’s team managed to clarify the strategic idea (vision, mission, corporate values), focusing the regulator’s activities on bringing Victory closer, and on creating a long-term plan that would pave the way forward for the NBU, its partners, and financial market participants.

“Our new Strategy is called Financial Stronghold of Ukraine. This is an apt and clear analogy. This is precisely what the financial ecosystem should be after all: a fortress impregnable by the enemy. And we as its architects should do everything that accelerates Victory,” said the NBU Governor.

Objectives that are important for our country are included in the Memorandum of Economic and Financial Policies between Ukraine and the International Monetary Fund. It is about restoring Ukraine’s debt sustainability, preserving liquidity, reducing the financing deficit, and creating the necessary conditions for the commercial sector’s participation in post-war reconstruction. The memorandum identifies key structural reforms, aimed at growth and European integration, that should be implemented in Ukraine, monetary and exchange policy measures, plans for recovery and further development of the financial system, which should become the engine of economic reconstruction. These tasks are laid out in the NBU’s new Strategy.

“Through this strategy, we declare that the NBU does not simply look passively on as events unfold around it, reacting to certain risks from time to time. We have a vision and an understanding of the trajectory of the NBU’s and the country’s progress. The NBU takes responsibility for qualitative changes in the financial and banking sector, and in laying the groundwork for rebuilding the Ukrainian economy. By virtue of this strategy, we reduce the uncertainty zone. We are paving the way towards Victory,” said Andriy Pyshnyy.

New strategic goals

The Strategy’s implementation will be carried out according to five strategic goals, which are focused on the regulator’s main functions: ensuring price and financial stability and supporting the country as it makes its way to Victory.

They are broken down into 24 strategic initiatives, on which the central bank will focus in the coming years.

The NBU’s strategic objectives take into account the challenges that arise in two areas: resistance to russian aggression, and Ukraine’s reconstruction. With this in mind, the initiatives and measures envisaged by the Strategy are roughly divided into two focuses: 

  • resistance – short-term measures aimed at ensuring stability and preventing a deterioration of the situation in the financial system and the economy in general, including the use of tools to control inflation and the hryvnia exchange rate, supporting the banking system, and more
  • recovery – medium-term measures aimed at introducing transformations that will form the basis for future reconstruction and growth of the economy, for example: reducing bureaucratic barriers, enhancing transparency and competitiveness of the environment, attracting investments, etc.

Goal 1: Sustainable Hryvnia

This goal takes a special place in the Strategy, because ensuring the stability of the monetary unit is the primary function of the NBU and is extremely important in wartime.

Within this objective, the central bank is expected to achieve price stability and exchange rate sustainability by:

  • developing a strategy to return to inflation targeting, currency liberalization, and a flexible exchange rate
  • gradually easing and phasing out FX restrictions
  • transitioning, step-by-step, to a flexible exchange rate
  • refocusing monetary policy on inflation.

Goal 2: Financial stability

Its achievement involves ensuring financial system conditions in which, regardless of all external influences, the financial system can properly perform its main functions – financial intermediation and payments – and successfully resist crises. This task is particularly important in wartime.

Its implementation requires the pursuit of the following strategic initiatives:

  • balanced, development-oriented regulation and supervision
  • sustainable and efficient banking system
  • insurance market ready to support a recovery
  • nonbank financial and payment market: transparent and technological
  • reliable and sustainable financial market infrastructure.

Goal 3: Financial System Operates to Restore the Country

This goal contributes to the recovery of the economy, the country’s reconstruction, and a return to sustainable rates of economic growth.

Within its mandate, the regulator will stimulate the qualitative development of the financial market through five initiatives included in this goal:

  • responsible financial market
  • developed credit market
  • developed insurance services market
  • developed capital markets’ infrastructure
  • financial literacy of the population and entrepreneurs.

Goal 4: Modern Financial Services

The financial system must work uninterrupted in times of war, hostilities, or blackouts. One of the central bank’s key tasks will be to strengthen cyber security and the efficiency of cash circulation, as well as further digitalize financial services, introduce new technologies, and promote cashless payments.

The following initiatives will be aimed at implementing this goal:

  • financial market as a digital stronghold
  • Power Banking 2.0: infrastructure repairs in de-occupied areas
  • technology development of the financial market
  • sustainable, performance-oriented, and customer-centric cash circulation
  • NBU’s virtual assets and digital cash: straightforward regulation to ensure monetary sovereignty
  • digital financial services as part of the digital state.

Goal 5: Effective Central Bank

It consists in ensuring stability, efficiency, and uninterrupted operation of the central bank as a key condition for meeting all of the previous objectives outlined in this Strategy.

Achieving this goal involves the implementation of the following seven initiatives:

  • NBU’s voice – strengthening the regulator’s communications
  • development of the NBU’s institutional relations with stakeholders
  • international cooperation and expertise exchange
  • European integration of the financial sector
  • effective operating activities
  • digital transformation of the NBU
  • human capital is the NBU’s fundamental asset.

The first four goals are thus outward-oriented, aimed at meeting the needs of financial ecosystem participants. The fifth goal – Effective Central Bank – aims to improve the pursuit of the NBU’s Mission and Vision through internal transformation.

For reference

On 22 May 2023, the new Strategy of the NBU was published on the NBU's official website.

Subscribe for notifications

Subscribe to news alerts