The National Bank of Ukraine has approved the list of banks eligible to participate in the FX interventions to be conducted in the form of a request for the best quotation in Q1 2018.
According to bank selection criteria, 20 banks eligible for FX interventions are selected based on the previous quarter’s best overall rating among banks involved in interbank operations. The overall composite rating is calculated based on individual rating scores assigned to a bank through the following three transparent criteria:
- the volume of transactions effected by the bank involving purchases/sales of foreign currency with other market participants and the NBU (the weight in the rating included in the calculation of the overall rating amounts to 50%);
- the volume of transactions performed by the bank involving purchases/sales of cashless foreign currency with bank’s customers (the weight in the rating is 30%); and
- the volume of the bank's assets (the weight in the rating is 20%).
Based on the above-mentioned criteria, the NBU’s list of banks eligible to participate in FX interventions conducted in the form of a request for best quotation in Q1 2018 was expanded to include ProCredit Bank JSC, while Prominvestbank PJSC was excluded from the list. The following banks will be eligible to participate in foreign currency interventions in January-March:
ALFA-BANK PJSC
BANK FOR INVESTMENTS AND SAVINGS PJSC
BANK CREDIT DNIPRO PJSC
ING Bank Ukraine PJSC
CB GLOBUS PJSC
CREDIT AGRICOLE BANK PJSC
OTP BANK JSC
Oschadbank JSC
Pivdennyi JSB
CB PRIVATBANK PJSC
PROCREDIT BANK JSC
FUIB PJSC
RAIFFEISEN BANK AVAL JSC
SBERBANK PJSC
CITIBANK PJSC
TASCOMBANK JSC
UКRGАZBАNК JSB
Ukreximbank JSC
UkrSibbank JSС
UКRSОTSBАNК PJSC
Interventions in the form of a request for best quotation have been conducted since early 2017 and introduced in accordance with the NBU’s Foreign Exchange Market Intervention Strategy for 2016-2020.
In 2017, the NBU purchased almost USD 2.3 billion in the interbank FX market, including over USD 1 billion through interventions held in the form of a request for best quotation. Over this period, the NBU sold USD 1 billion in the interbank FX market, including USD 239 million sold through interventions in the form of a request for best quotation.
A FX intervention in such a form is carried out in the following way. First, the NBU requests banks to quote ask/bid prices for foreign currency through Bloomberg and Reuters trading information systems. After receiving bids from the banks, the NBU enters into an agreement with the bank that has quoted the best price.