National Bank of Ukraine

Central bank of Ukraine

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National Bank of Ukraine
Національний банк України

National Bank of Ukraine Building in Kyiv

Headquarters| 9, Instytutska st, Kyiv, 01601
Coordinates| 50°26′50″N 30°31′52″E﻿ / ﻿50.44722°N 30.53111°E﻿ / 50.44722; 30.53111
Established| 1991
Ownership| 100% state ownership[1]
Governor| Andriy Pyshnyi[2]
Central bank of|  Ukraine
Currency| Ukrainian hryvnia
UAH (ISO 4217)
Reserves| $40.5 billion
Bank rate| 25.0% (from June 03, 2022)[3] UAH 20.20%, FE 4.80% (January 2019)[4]
Interest on reserves| UAH 13.0%, FE 2.60% (January 2019)
Preceded by| Gosbank (in Ukrainian SSR territory)
Website| bank.gov.ua/en/

The National Bank of Ukraine (Ukrainian: Національний банк України, romanized: Natsionalnyi bank Ukrainy [nɐt͡sʲiɔˈnalʲnei̯ bank ʊkrɐˈjine], NBU / НБУ) is the central bank of Ukraine. Created in 1991 from the Ukrainian operations of the Soviet Gosbank, the NBU employs over 12,000 people, making it one of the largest employers in the financial sector in Ukraine. It regulates and supervises activities, functions and the legal status of public and commercial banks based on the principles of the Constitution of Ukraine and the law of Ukraine.[5]

## History

[edit]

Silver hryvnia of the 11th-13th centuries

The State Bank of Ukraine [uk] (Український державний банк) was a predecessor of the NBU, founded on 22 December 1917 under a law passed by the Central Rada of the Ukrainian People's Republic on the basis of the Kyiv branch of the State Bank of the Russian Empire. It functioned under the UPR and Ukrainian State governments until it was liquidated by the Bolsheviks at the end of the Ukrainian War of Independence.

The Ukrainian branch of the Soviet Gosbank took on central banking functions in Ukraine in early 1991. Like institutions of many newly independent nations, it faced dire financial straits during the 1990s, leading to a prolonged period of hyperinflation. On 20 March 1991, the Verkhovna Rada (parliament) adopted the resolution "On Banks and Banking Activity", which became law on May 1. The resolution declared ownership by the Ukrainian SSR of the Ukrainian Republican branch of the Gosbank, which was subsequently renamed the National Bank. The same resolution simultaneously nationalized the Ukrainian Republic branch of the Soviet Promstroybank renamed Prominvestbank, the Ukrainian Republic branch of the Savings Bank of the USSR, and the Ukrainian Republic branch of the Foreign Trade Bank of the USSR as well as the Ukrainian Republic Department of cash settlement of the Soviet Gosbank.

Following the introduction of martial law on 24 February 2022, the National Bank of Ukraine took the extraordinary step of creating and promoting two separate accounts to receive donations (domestic and international) as a response to the Russian invasion of Ukraine: one account to support the Ukrainian military,[6][7][8] and the other account to support the general populace with humanitarian assistance.[9] On 5 March 2022, the NBU reported having raised "more than UAH 10 billion" (roughly USD $350 million) for military and humanitarian aid.[10]

## Legal status and structure

[edit]

Regional branch in Odesa Regional branch in Dnipro

The legal status of the National Bank of Ukraine and the principles of its organization and activities are determined by the Constitution of Ukraine and the Law of Ukraine "On the National Bank of Ukraine".[11]

The National Bank of Ukraine is a legal entity with separated property, which is the object of the state property. Its authorized capital amounts to UAH 100 million and is the state-owned property which is in the full economic competence of the National Bank.[12]

According to Article 99 of the Constitution of Ukraine, adopted in 1996, the main function of the country's central bank is to ensure stability of monetary unit – the Hryvnia (Ukrainian's national currency). To carry out its main function, the National Bank shall foster the stability of the banking system and, within its competence, the price stability.

According to the Law of Ukraine "On the National Bank of Ukraine", the functions of the National Bank are:

* Ensuring the stability of Ukrainian currency;
* Development and implementation together with the government of an effective credit and monetary policy;
* Implementation of monetary emission and control over monetary circulation;
* Implementation of inter-bank settlements, including in international relations;
* Sale of credit resources to commercial banks and lending to the government;
* Regulation and control over the activities of commercial banks and other credit organizations;
* Implementation of currency regulation and ensuring the convertibility of the national currency;
* Storage and regulation of gold and currency reserves;
* State debt management;

The National Bank of Ukraine has the power to introduce legislation in the Verkhovna Rada.[13] Resolutions of the NBU become enforceable when published on its website. Decisions of the NBU may be contested through the courts pursuant to Art.74 of the Law on the National Bank,[14] however, courts may not suspend resolutions during the investigation of appeals.

The Governor of the National Bank of Ukraine is the chief executive, while its functions are coordinated by the Council of the National Bank of Ukraine. The council consists of 15 members including the Governor of the National Bank ex officio. Seven members are appointed by the President of Ukraine and the Verkhovna Rada. The quorum of the Council is six members.[15]

## Functions

[edit]

See also: Banking in Ukraine

100 Ukrainian hryvnia bill

According to the Constitution of Ukraine, the main function of the National Bank of Ukraine (NBU) is to ensure the stability of Ukraine's monetary unit (the hryvnia). To carry this out, the National Bank fosters the stability of the banking system and, within its competence, price stability.

Due to Art.51 of the law on the National Bank of Ukraine, the NBU is accountable for its activities to the Verkhovna Rada (the parliament of Ukraine), the President of Ukraine and the Cabinet of Ministers of Ukraine.[14]

### Banking supervision

[edit]

As part of its central banking functions, the National Bank bears responsibility for banking regulation and supervision in Ukraine.

All registered banks in Ukraine are member of the Deposit Guarantee Fund, which provides deposit insurance up to 200.000 UAH (approx. USD $5000) per person and bank in case of insolvency. Until 2022, Oshadnybank was excluded from this fund because the Ukrainian state guaranteed its deposits directly. It joined the DGF in April 2022.

Banks are divided by the National Bank into four categories depending on their size (for intensity of banking supervision).[16]

Since 2016, the Bank's Anti-Money Laundering and Tax-Evasion Policy has required the ownership structures of banks to published.

## Governors of the National Bank of Ukraine

[edit]

The Governor of the National Bank of Ukraine is dismissed and appointed by the Verkhovna Rada (Ukraine's parliament).[17][18] The President of Ukraine nominates a candidate before she/he can obtain a parliamentary approval.[17] The President (also) submits to the Verkhovna Rada the draft resolution on the dismissal of the Governor.[19]

The following people have served as the Governor of the National Bank since 1991:

No.  | Portrait  | Name  | Took office  | Left office

|
|
|
|

1 |  | Volodymyr Matvienko | 1991  | 1992
2 |  | Vadym Hetman | 1992  | 1992
3 |  | Viktor Yushchenko | 1993  | 2000
4 |  | Volodymyr Stelmakh | 2000  | 2002
5 |  | Sergiy Tigipko | 2002  | 2004
6 |  | Volodymyr Stelmakh | 2004  | 2010
7 |  | Serhiy Arbuzov | 2010  | 2012
8 |  | Ihor Sorkin | 2013  | 2014
9 |  | Stepan Kubiv | 2014[20][21] | 2014[22]
10 |  | Valeriya Hontareva | 2014[22][23] | 2017[24] On 11 May 2017 the bank installed deputy governor Yakiv Smoliy as acting governor.[25]
11 |  | Yakiv Smoliy | 2018[26] | 2020[27] On 3 July 2020 First Deputy Governor Kateryna Rozhkova temporarily assumed Smoliy's duties.[28]
12 |  | Kyrylo Shevchenko | 2020[29] | Asked for his resignation on 4 October 2022.[18][30] Dismissed by parliament two days later.[31]
13 |  | Andriy Pyshnyi | 2022[2] | actual

## Commemorative coins

[edit]

The national Bank of Ukraine offers a broad scale of commemorative and bullion coins and numismatic products, which are being sold primarily (2/3 of production) by the branches of NBU and 1/3 by state banks (Oschadbank and Ukrgasbank).[32][33]

## See also

[edit]

* Banks portal

* National Bank of Ukraine building
* Ministry of Finance (Ukraine)
* Banking in Ukraine
* List of banks in Ukraine
* List of central banks

## References

[edit]

1. ^ Weidner, Jan (2017). "The Organisation and Structure of Central Banks" (PDF). Katalog der Deutschen Nationalbibliothek.
2. ^ a b "Ukrainian parliament approves new central bank chief". Reuters. 7 October 2022. Retrieved 7 October 2022.
3. ^ "NBU Raises Key Policy Rate to 25%". Fin.org.ua.
4. ^ "National Bank of Ukraine Official Website. Cost of term deposits". 24 January 2019. Archived from the original on 8 March 2017.
5. ^ "The Law of Ukraine on the National Bank of Ukraine". National Bank of Ukraine. Retrieved 17 January 2022.
6. ^ "Procedure for Cash Transferring by Banks to Support Armed Forces of Ukraine Simplified", National Bank of Ukraine; 27 February 2022. (Accessed 2022-03-06.)
7. ^ "It Is Now Easier to Transfer Funds to Help Armed Forces of Ukraine", National Bank of Ukraine; 27 February 2022. (Accessed 2022-03-06.)
8. ^ "NBU Opens Special Account to Raise Funds for Ukraine’s Armed Forces (updated)", National Bank of Ukraine; 01 March 2022. (Accessed 2022-03-06.)
9. ^ "Very Easy to Donate Funds to Help Ukrainian Victims", National Bank of Ukraine; 03 March 2022. (Accessed 2022-03-06.)
10. ^ "More Than UAH 10 Billion Raised for Army and Humanitarian Aid", National Bank of Ukraine; 05 March 2022. (Accessed 2022-03-06.)
11. ^ "Archived copy" (PDF). Archived from the original (PDF) on 4 January 2011. Retrieved 26 January 2011.`{{cite web}}`: CS1 maint: archived copy as title (link)
12. ^ Reporting 01.04.2016 NBU
13. ^ Rada Approves Cancellation of Rule That Bans Deputies From Switching Factions Archived 2010-10-09 at the Wayback Machine, The Financial (October 8, 2010)
14. ^ a b "Archived copy". Archived from the original on 20 September 2016. Retrieved 26 May 2016.`{{cite web}}`: CS1 maint: archived copy as title (link)
15. ^ Danylyshyn heads NBU Council Archived 2016-10-26 at the Wayback Machine, Interfax-Ukraine (25 October 2016)
16. ^ "ipLex - законодавство України". zakon.nau.ua. Archived from the original on 3 November 2013. Retrieved 10 September 2013.
17. ^ a b "Ukraine parliament approves Shevchenko as new central bank chief". Reuters. 16 July 2020. Retrieved 16 July 2020.
18. ^ a b "Ukraine Central Banker Quits, Adding to War's Economic Turmoil". Bloomberg News. 4 October 2020. Retrieved 5 October 2022.
19. ^ "Zelensky submitted to the Council a motion to dismiss Shevchenko from the position of head of the NBU". Ukrainska Pravda (in Ukrainian). 5 October 2020. Retrieved 5 October 2022.
20. ^ Ukraine's parliament appoints new central bank chief Archived 2014-02-28 at the Wayback Machine, Reuters (24 February 2014)
21. ^ (in Ukrainian) MPs changed the head of the National Bank Archived 2014-03-13 at the Wayback Machine, Ukrayinska Pravda (24 February 2014)
22. ^ a b Ukraine crisis: EU deal to be signed on 27 June Archived 2014-06-19 at the Wayback Machine, BBC News (19 June 2014)
23. ^ Ukraine president gets parliament boost for peace plan Archived 2014-06-20 at the Wayback Machine, AFP news agency (19 June 2014)
24. ^ Williams, Matthias; Polityuk, Pavel; Rao, Sujata (10 April 2017). "After praise and death threats, Ukraine's central bank governor quits". Reuters. Archived from the original on 10 April 2017. Retrieved 10 April 2017.
25. ^ Williams, Matthias (10 May 2017). "Ukraine central bank post in political limbo as Gontareva leaves". Mobile.reuters.com. Retrieved 11 May 2017.
26. ^ "Rada appoints Yakiv Smolii NBU head". En.interfax.com.ua. Retrieved 17 January 2022.
27. ^ Ukraine's parliament backs chief banker's exit, UNIAN (3 July 2020)
28. ^ Rozhkova takes office as acting Governor of NBU, Interfax-Ukraine (3 July 2020)
29. ^ Ukraine's parliament backs appointment of Kyrylo Shevchenko as NBU governor, UNIAN (16 July 2020
30. ^ "Голова Національного банку Кирило Шевченко подав заяву про відставку". bank.gov.ua (in Ukrainian). 4 October 2022.
31. ^ "Rada Dismisses NBU Head Shevchenko". Ukrainian News Agency. 6 October 2020. Retrieved 6 October 2022.
32. ^ "Banknotes and Coins". Bank.gov.ua. Archived from the original on 6 May 2016. Retrieved 26 May 2016.
33. ^ "National Bank of Ukraine issues commemorative coin". Cistran Finance. 21 October 2013. Archived from the original on 29 October 2013. Retrieved 25 October 2013.

### Sources

[edit]

Dushkevych, N. and V. Zelenyuk (2007) "Banking in Ukraine: Changes Looming?" Beyond Transition Newsletter 17:2, (The Newsletter About Reforming Economies, THE WORLD BANK, 2007).

* (in Ukrainian) Про банки і банківську діяльність. Law of Ukraine. March 20, 1991.
* (in Ukrainian) Про банки і банківську діяльність. Law of Ukraine. Accessed on August 17, 2006.
* (in Ukrainian) Про Національний банк України. Law of Ukraine. Accessed on August 17, 2006.

## External links

[edit]

Wikimedia Commons has media related to National Bank of Ukraine.

* Official website (in Ukrainian and English)
* Вся правда про фінансову систему СРСР (Ч.4 Перебудова) (All truth about financial system of the USSR (P.4: Perestroika))
* Melnyk, P., Tarahul, L., Hordei, O. Banking system of Russia. Banking systems of foreign countries (handbook). 2010.
* Kostyuchenko, O. Creation and evolution of banking in Ukraine. Banking Law. 2011.

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