National Bank of Ukraine (NBU) has expanded the options for nonresident banks to purchase and sell foreign currencies using the hryvnia. To this effect, the central bank has clarified the terms “foreign exchange market of Ukraine” and “global foreign exchange market”.
These clarifications enable foreign banks to carry out hryvnia settlements for FX deals with other foreign banks under agreements concluded outside of Ukraine using their correspondent accounts in Ukrainian banks.
In addition, foreign banks are able to enter into agreements with any Ukrainian bank to buy or sell foreign currency for hryvnias (regardless of what bank opened the correspondent account).
We believe that such step would stimulate further growth in competition and liquidity at Ukrainian interbank FX market and will make hryvnia assets more attractive to foreign investors.
The amendments approved by NBU Board Resolution No. 16 On Amendments to the Regulation on the Structure of the Foreign Exchange Market of Ukraine, and the Terms and Procedure for Trading in Foreign Currency and Investment Metals in the Foreign Exchange Market of Ukraine, dated 6 February 2020, come into effect on 8 February 2020.