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Financial Sector Conditions Improve, Resilience to Significant Adverse Events Rises – Systemic Risk Survey

Financial Sector Conditions Improve, Resilience to Significant Adverse Events Rises – Systemic Risk Survey

Respondents’ assessments of the Ukrainian financial sector’s current standing improved to record highs since this poll began in May 2018. This is according to the November 2021 Systemic Risk Survey.

The financial sector situation has improved over the past six months, almost 40% of top managers said.

This was the first time that respondents rated the financial sector’s resilience to high-impact adverse events as above average.

Most financial executives said they did not expect the financial sector’s condition to deteriorate in the next six months, while one-fifth of those surveyed predicted an improvement.

Respondents continued to regard the overall level of corruption, the activities of law enforcement authorities, and the judiciary as the main sources of risk. The risk of Russia scaling up its aggression in the east of Ukraine was named as one of the top three risks for the first time since the survey began. Estimates of economic factors continued to improve, although inflation risks increased markedly. The new risk factors "anti-pandemic quarantine measures" and "climate change" ranked eighth and eighteenth, respectively.

The overall risk appetite of financial institutions has slightly increased over the past six months.

The next Systemic Risk Survey will be published in May 2022.

For reference

This survey was carried out between 10 November and 24 November 2021. Executives from 22 banks, 12 insurance companies, and 3 investment firms took part in this survey. The survey did not cover financial institutions under sanctions. In calculating the results, all responses were assigned equal weights, regardless of bank/company size or market share.

Conducted by the NBU twice a year, the Systemic Risk Survey looks into how the largest banks and NBFIs perceive existing and potential risks to the financial sector. The poll reflects assessments by top managers of financial institutions of how the financial sector has fared over the past six months and what to expect in the next six months.

The results presented in the survey are based on respondents’ opinions and do not necessarily reflect the NBU’s assessment of financial system risks.


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