In Q2 2025 (hereinafter referred to as Q2), transaction volumes grew across all segments of the non-bank financial services market. This is according to the Non-bank Financial Sector Review.
The total assets of non-bank financial service providers in Q2 decreased by 11.7% qoq, as a large state-owned leasing company voluntarily surrendered its license. At the same time, in annual terms, assets increased by 1.8%. The share of NBU-supervised non-bank financial institutions (NBFIs) in the financial sector’s total assets declined to 8.9% in Q2.
Insurers
Non-life insurers’ assets in Q2 increased by 8% qoq and by 26% yoy, while life insurers’ assets grew by 3% qoq and 12% yoy.
Insurance premiums of non-life insurers rose, while life insurance premiums dropped.
In H1, non-life insurers’ net profit rose by a third year-on-year, to UAH 1.9 billion. Their return on equity increased by 2 pp, to 10%. Life insurers’ profit halved, dropping to UAH 0.45 billion.
As of the end of Q2, all insurers complied with the solvency capital requirement (SCR) and the minimum capital requirement (MCR).
Credit Unions
In Q2, assets of deposit-taking credit unions continued to decline, while assets of non-deposit-taking credit unions increased slightly, despite a decrease in their number.
Volumes of new loans rose by 11% qoq. That said, the size and quality of the loan portfolio remained almost unchanged.
The moderate profitability of credit unions, driven by the release of provisions, contributed to the growth in credit unions’ equity – by 11.4% qoq and by 8.7% yoy.
At the start of July, two unions were in breach of the regulatory capital adequacy ratio, one union licensed to take deposits failed to comply with the Tier 1 capital adequacy ratio, and another three such unions did not have a proper liquidity cushion.
Finance Companies and Pawnshops
The assets of finance companies decreased by 16.4% qoq in Q2 and 3.3% yoy, primarily due to the revocation of the license of a state-owned leasing company. Lending and financial leasing grew in volume, while volumes of guarantees and factoring declined slightly.
In H1, 82% of the institutions recorded a profit. As before, almost half of the segment’s profit was earned by UKRFINZHYTLO PrJSC, the operator of the eOselia program (primarily due to earned interest on the domestic government debt securities in its capital).
The number of companies violating prudential requirements decreased from seven to five over the quarter. Companies that fail to eliminate violations leave the market. The sources of capital increases by several companies to meet regulatory requirements continue to be inspected.
Pawnshops’ assets in Q2 increased by 1.9% qoq and by 15.4% yoy. Lending volumes rose by 16.7% and 62.1%, respectively. Revenues from providing financial services grew, making the segment profitable despite higher costs.
Prospects and Risks
The NBU updated the solvency requirements for insurers and credit unions and increased the frequency of reporting for finance companies. Market participants must adapt to the new requirements and comply with them further on.
The Non-bank Financial Sector Review is a report that was first published by the NBU in October 2020. It focuses on the activities of NBU-regulated non-bank financial institutions, such as insurers, credit unions, finance companies, and pawnshops. The review highlights key developments in the non-bank financial market and provides comprehensive insights into its performance.
Along with submitting Q2 2025 reports, NBFIs could update their reporting data for Q1. Retroactive adjustments were therefore made to some of the indicators.