National Bank of Ukraine
Encyclopedia
National Bank of Ukraine is the central bank
of Ukraine
. Its headquarters building
, constructed between 1902 and 1934, is located at no. 9 Institutska St., in Kiev
. Officially, the National Bank of Ukraine acted as the Central Bank of Ukraine since early 1992. Like institutions of many newly independent nations, it faced dire financial straits during the 1990s, leading to a prolonged period of hyperinflation
.
On March 20, 1991, the Verkhovna Rada of Ukraine
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 Bank of the State Bank of the USSR, the Ukrainian Republican Bank (affiliate) of the State Commercial Industrial-Constructional Bank of the USSR, the Ukrainian Republican Bank of the Savings Bank of the USSR, and the Ukrainian Republican Bank of the ForeignEconomBank of the USSR as well as the Ukrainian Republican Department of Encashment of the State Bank of the USSR. The National Bank of Ukraine was resolved to be created on the basis of the Ukrainian Republican Bank of the State Bank of the USSR.
Former President of Ukraine
Viktor Yushchenko
was Governors of the National Bank of Ukraine from January 1993 to December 1999, before becoming Prime Minister
.
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"http://www.bank.gov.ua/Engl/B_legisl/LawNBU_e.pdf.
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
10 million and is the state-owned property which is in the full economic competence of the National Bank.
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. 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 National Bank is the central bank of Ukraine, a specific central body of the state administration, its issuing center which pursue common state policy in money
circulation, credit
, strengthening of monetary unit; it coordinates functioning of the banking system in general; determines exchange rate
of the monetary unit against foreign currencies. The National Bank determines a kind of bank notes, their denomination, distinctive features and their protection system. The National Bank of Ukraine ensures the accumulation and custody of the gold
and currency reserves and the conduction of transactions with them and the banking metals. The National Bank of Ukraine sets up the order of determining a discount rate
and other interest rates; it gives permission for commercial bank
s' registration and licenses banking business; determines the standard of emergency funds for commercial banks and other financial and credit institutions.
The National Bank of Ukraine has the power to initiate legislation.
The National Bank of Ukraine is governed by the Head of the National Bank of Ukraine and its directory, while its functions are coordinated by the Council of the National Bank of Ukraine. The council consists of 15 members including the Head of the National Bank as the ex-officio position. The other members of the council are appointed by an equal quota of seven members from the President of Ukraine and the Verkhovna Rada.
, the main function of the National Bank is to ensure the stability of Ukraine's monetary unit. To carry this out the National Bank fosters the stability of the banking system and, within its competence, price stability.
The National Bank also carries out the following functions:
Central bank
A central bank, reserve bank, or monetary authority is a public institution that usually issues the currency, regulates the money supply, and controls the interest rates in a country. Central banks often also oversee the commercial banking system of their respective countries...
of Ukraine
Ukraine
Ukraine is a country in Eastern Europe. It has an area of 603,628 km², making it the second largest contiguous country on the European continent, after Russia...
. Its headquarters building
National Bank of Ukraine building
The National Bank of Ukraine opened in Kiev, Ukraine in 1839.By the end of the nineteenth century the bank's expansion meant that new premises were required...
, constructed between 1902 and 1934, is located at no. 9 Institutska St., in Kiev
Kiev
Kiev or Kyiv is the capital and the largest city of Ukraine, located in the north central part of the country on the Dnieper River. The population as of the 2001 census was 2,611,300. However, higher numbers have been cited in the press....
History
Prior to the collapse of the USSR, the National Bank of Ukraine was a branch of the Central Bank of the USSRGosbank
Gosbank was the central bank of the Soviet Union and the only bank whatsoever in the entire Union from the 1930s until the year 1987. Gosbank was one of the three Soviet economic authorities, the other two being "Gosplan" and "Gossnab"...
. Officially, the National Bank of Ukraine acted as the Central Bank of Ukraine since early 1992. Like institutions of many newly independent nations, it faced dire financial straits during the 1990s, leading to a prolonged period of hyperinflation
Hyperinflation
In economics, hyperinflation is inflation that is very high or out of control. While the real values of the specific economic items generally stay the same in terms of relatively stable foreign currencies, in hyperinflationary conditions the general price level within a specific economy increases...
.
On March 20, 1991, the Verkhovna Rada of Ukraine
Verkhovna Rada
The Verkhovna Rada of Ukraine is Ukraine's parliament. The Verkhovna Rada is a unicameral parliament composed of 450 deputies, which is presided over by a chairman...
adopted the resolution "On Banks and Banking Activity", which became Law on May 1. The resolution declared ownership by the Ukrainian SSR
Ukrainian SSR
The Ukrainian Soviet Socialist Republic or in short, the Ukrainian SSR was a sovereign Soviet Socialist state and one of the fifteen constituent republics of the Soviet Union lasting from its inception in 1922 to the breakup in 1991...
of the Ukrainian Republican Bank of the State Bank of the USSR, the Ukrainian Republican Bank (affiliate) of the State Commercial Industrial-Constructional Bank of the USSR, the Ukrainian Republican Bank of the Savings Bank of the USSR, and the Ukrainian Republican Bank of the ForeignEconomBank of the USSR as well as the Ukrainian Republican Department of Encashment of the State Bank of the USSR. The National Bank of Ukraine was resolved to be created on the basis of the Ukrainian Republican Bank of the State Bank of the USSR.
Former President of Ukraine
President of Ukraine
Prior to the formation of the modern Ukrainian presidency, the previous Ukrainian head of state office was officially established in exile by Andriy Livytskyi. At first the de facto leader of nation was the president of the Central Rada at early years of the Ukrainian People's Republic, while the...
Viktor Yushchenko
Viktor Yushchenko
Viktor Andriyovych Yushchenko is a former President of Ukraine. He took office on January 23, 2005, following a period of popular unrest known as the Orange Revolution...
was Governors of the National Bank of Ukraine from January 1993 to December 1999, before becoming Prime Minister
Prime Minister of Ukraine
The Prime Minister of Ukraine is Ukraine's head of government presiding over the Cabinet of Ministers of Ukraine, which is the highest body of the executive branch of the Ukrainian government....
.
Legal Status and Structure
Constitution of Ukraine
The Constitution of Ukraine is the nation's fundamental law. The constitution was adopted and ratified at the 5th session of the Verkhovna Rada of Ukraine on 28 June 1996. The constitution was passed with 315 ayes out of 450 votes possible .Other laws and other normative legal acts of Ukraine...
and the Law of Ukraine "On the National Bank of Ukraine"http://www.bank.gov.ua/Engl/B_legisl/LawNBU_e.pdf.
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
UAH
UAH may refer to:* Ukrainian hryvnia, the national currency of Ukraine* Universidad Alejandro de Humboldt, Venezuela* University of Alabama in Huntsville, a state-supported, public, coeducational university, located in Huntsville, Alabama, United States...
10 million and is the state-owned property which is in the full economic competence of the National Bank.
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. 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 National Bank is the central bank of Ukraine, a specific central body of the state administration, its issuing center which pursue common state policy in money
Money
Money is any object or record that is generally accepted as payment for goods and services and repayment of debts in a given country or socio-economic context. The main functions of money are distinguished as: a medium of exchange; a unit of account; a store of value; and, occasionally in the past,...
circulation, credit
Credit (finance)
Credit is the trust which allows one party to provide resources to another party where that second party does not reimburse the first party immediately , but instead arranges either to repay or return those resources at a later date. The resources provided may be financial Credit is the trust...
, strengthening of monetary unit; it coordinates functioning of the banking system in general; determines exchange rate
Exchange rate
In finance, an exchange rate between two currencies is the rate at which one currency will be exchanged for another. It is also regarded as the value of one country’s currency in terms of another currency...
of the monetary unit against foreign currencies. The National Bank determines a kind of bank notes, their denomination, distinctive features and their protection system. The National Bank of Ukraine ensures the accumulation and custody of the gold
Gold
Gold is a chemical element with the symbol Au and an atomic number of 79. Gold is a dense, soft, shiny, malleable and ductile metal. Pure gold has a bright yellow color and luster traditionally considered attractive, which it maintains without oxidizing in air or water. Chemically, gold is a...
and currency reserves and the conduction of transactions with them and the banking metals. The National Bank of Ukraine sets up the order of determining a discount rate
Discount rate
The discount rate can mean*an interest rate a central bank charges depository institutions that borrow reserves from it, for example for the use of the Federal Reserve's discount window....
and other interest rates; it gives permission for commercial bank
Commercial bank
After the implementation of the Glass–Steagall Act, the U.S. Congress required that banks engage only in banking activities, whereas investment banks were limited to capital market activities. As the two no longer have to be under separate ownership under U.S...
s' registration and licenses banking business; determines the standard of emergency funds for commercial banks and other financial and credit institutions.
The National Bank of Ukraine has the power to initiate legislation.
The National Bank of Ukraine is governed by the Head of the National Bank of Ukraine and its directory, while its functions are coordinated by the Council of the National Bank of Ukraine. The council consists of 15 members including the Head of the National Bank as the ex-officio position. The other members of the council are appointed by an equal quota of seven members from the President of Ukraine and the Verkhovna Rada.
Functions
According to the Constitution of UkraineConstitution of Ukraine
The Constitution of Ukraine is the nation's fundamental law. The constitution was adopted and ratified at the 5th session of the Verkhovna Rada of Ukraine on 28 June 1996. The constitution was passed with 315 ayes out of 450 votes possible .Other laws and other normative legal acts of Ukraine...
, the main function of the National Bank is to ensure the stability of Ukraine's monetary unit. To carry this out the National Bank fosters the stability of the banking system and, within its competence, price stability.
The National Bank also carries out the following functions:
- to determine and pursue the monetary policy in accordance with the General Principles of the Monetary Policy developed by the Council of the National Bank of Ukraine;
- to issue the national currency of Ukraine on a monopoly basis and to organize its circulation;
- to establish the rules of conducting banking transactions, accounting and reporting, protection of the information, funds and property for the banks and other financial and credit institutions;
- to organize and to provide the methodological support to the system of the monetary, crediting and banking statistical information and the statistics of the balance of payments;
- to determine the areas of the development of modern electronic banking technologies, to establish, co-ordinate and control the creation of electronic means of payment, payment system, banking automation and the banking information protection facilities;
- to exercise the banking regulation and supervision;
- to keep a Register of banks, their branch and representative offices, currency exchanges and financial and credit institutions, to license banking business and transactions, if provided for by the laws;.
- to compile, analyze and forecast the balance of payments;
- to represent Ukraine's interests in central banks of other states, international banks and other crediting institutions, where the cooperation takes place at the level of central banks;
- to exercise the currency regulation with the competence to be defined by a special law, to determine the procedure of effecting payments in the foreign currency, to organise and exercise the currency control over the commercial banks and other credit institutions which are in possession of a National Bank's license for the transactions with currency values;
- to ensure the accumulation and custody of the gold and currency reserves and the conduction of transactions with them and the banking metals;
- to analyze the status of the monetary, crediting, financial, pricing and currency relations;
- to organize the collection and transportation of bank notes, coins and other values;
- to implement the national policy of the protection of state secrets within the system of the National Bank;
- to take part in the training of personnel for Ukraine's banking system;
- to exercise other functions in the monetary and crediting sphere within its competence defined by the law.
Governors of the National Bank of Ukraine
Since the Banks' establishment, the following statesmen were the Governors of the National Bank of Ukraine (initially the title of the position was the Chairman of the Board of the National Bank of Ukraine)| Name | In office |
|---|---|
| Volodymyr Matvienko | 1991–1992 |
| Vadym Hetman Vadym Hetman Vadym Petrovych Hetman was a Ukrainian statesman and banker. He is credited with the creation of the central bank of the country, the National Bank of Ukraine.... |
1992 |
| Viktor Yushchenko Viktor Yushchenko Viktor Andriyovych Yushchenko is a former President of Ukraine. He took office on January 23, 2005, following a period of popular unrest known as the Orange Revolution... |
1993–1999 |
| Volodymyr Stelmakh Volodymyr Stelmakh Volodymyr Stelmakh — banker, economist , statesman and current Governor of the National Bank of Ukraine.... |
2000–2002 |
| Sergiy Tigipko | 2002–2004 |
| Volodymyr Stelmakh Volodymyr Stelmakh Volodymyr Stelmakh — banker, economist , statesman and current Governor of the National Bank of Ukraine.... |
2004–2010 |
| Serhiy Arbuzov | 2010–present |
Council of the National Bank of Ukraine
- Iryna Akimova - Presidential decree (2010)
- Serhiy Arbuzov - ex-officio
- Pavlo Haidutsky - Presidential decree (2010)
- Valeriy Heyets - Presidential decree (2005)
- Mykhailo Honcharov - Verkhovna Rada declaration (2007)
- Vasyl Horbal - Verkhovna Rada declaration (2007)
- Serhiy Klyuev - Verkhovna Rada declaration (2007)
- Borys KolesnikovBorys KolesnikovBorys Viktorovych Kolesnikov is the Vice Prime Minister of Ukraine - Minister of Infrastructure of Ukraine, Ukrainian politician, statesman, responsible for preparation and hosting European Football Championship in 2012 , philanthropist....
- Verkhovna Rada declaration (2007) - Yuriy Polunyeev - Verkhovna Rada declaration (2008)
- Petro Poroshenko - Verkhovna Rada declaration (2007)
- Andriy Portnov - Presidential decree (2010)
- Ihor Prasolov - Verkhovna Rada declaration (2007)
- Viktor Fedosov - Presidential decree (2010)
- Valeriy Khoroshkovskiy - Presidential decree (2010)
- Roman Shpek - Presidential decree (2010)
Banking sector
There are more than 180 banks under the supervision of the NBU. Among the major banks in the country are:- PrivatBankPrivatbankPrivatBank is the largest commercial bank in Ukraine, in terms of the number of clients, assets value, loan portfolio and taxes paid to the national budget. Unlike most other large Ukrainian banks, PrivatBank is not based in Kiev, the capital city, but is headquartered in Dnipropetrovsk, a smaller...
- the leading bank in countryRaiffeisen Bank Aval - UkrSibbankUkrSibbank«UkrSibbank» - full name Public joint-stock company “UkrSibbank”. It was registered on June 18, 1990. As of today, JSC «UkrSibbank» is the third largest bank of Ukraine, the second among foreign-owned banks, and acts as a financial supermarket....
(subsidiary of BNP Paribas) - UkrSocBank
- State Savings Bank of Ukraine (Oshchadbank) (State bank)
- UkrEximBank (State bank)
- PromInvestBankProminvestbankProminvestbank was formed in August 1992...
- Nadra BankOTP BankOTP BankOTP Bank is the biggest commercial bank in Hungary, operating in Central and Eastern Europe. The bank provides universal financial services for more than 13 million costumers, through nearly 1500 branches in 9 countries....
- Finances and CreditFinance and Credit (bank)Finance and Credit is a Ukrainian commercial bank with its head office located at Kiev. Bank Finance and Credit was established in 1990 and according to the NBU ratings it belongs to the group of the major banks in Ukraine by the volume of assets. Net assets as of 01.05.2010 made up UAH 20.699...
- KreditPromBank
- First Ukrainian International Bank
- UkrPromBank
- BrokBiznesBank
- Forum
- KomertsBankAlfa-Bank
- UkrHazBank
- Rodovid BankRodovid BankOJSC "Rodovid Bank" is a universal commercial bank providing its services for private individuals and legal entities throughout Ukraine...
VAB Bank