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11.03.2010
Credit-Rating: new restrictions imposed in the currency market to negatively affect ordinary depositors
Credit-Rating subscribes to the opinion that the restrictions on purchase of
foreign currency for banks in order to fulfill their obligations to depositors may prompt
late repayment of foreign currency-denominated deposits by certain banks, and make
banking institutions more dependant upon currency-related policy. The NBU’s Resolution
#762 dated Dec. 23, 2009 is an element of measures aimed at administrative handling of
demand in the national currency market and captures all banks’ transactions related to
repayment of foreign currency-denominated deposits, which will be performed basing in
bank deposit agreements concluded or prolonged after the Resolution comes into
effect.
According to Galina Vinnik, a Credit-Rating’s leading financial analyst ‘restrictions imposed on purchase of foreign currencies for repayment of deposits will contribute to decreasing specific gravity of foreign currency in liabilities of the banking system, as it is a restraint for depositors’.
Credit-Rating notes that a shift in the procedure of foreign investing (which is also stated in the Resolution #762 of Dec. 23, 2009) will allow to make the national economy less dependant upon foreign speculative capital. However, the restrictions contained in these rules concerning purchase of foreign currency for repayment of investments abroad, may decrease investment attractiveness of Ukraine’s banking and real economy sectors in short-term perspective.
Credit-Rating believes that the regulator’s administrative actions in the foreign currency market is of temporary nature, and is prompted by limited NBU’s capacity for adequate offer of foreign currency under adverse economic environment. It is likely that the National Bank may take compromise decisions in the banking sector and weaken force of certain of its resolution.
Credit-Rating agency has operated in the Ukrainian market since 2001 being committed to assignment of the national scale ratings. The agency has assigned 1081 ratings since start of its activities. As at March 1, 2010 the Credit-Rating’s list of ratings is represented with 662 ongoing ratings: 508 in corporate, 105 in financial, and 49 in municipal sectors. In February 2010 Credit-Rating has assigned 8 credit ratings, revised 19 ratings, suspended 5 ratings and withdrawn 15 ratings.
Information on all credit ratings assigned in accordance with the National Rating Scale may be found in REUTERS and BLOOMBERG information systems.
For more information, please contact:
Information and
analytic department
Sergey Rozumyak +38044490 25 50
SRozumyak@credit-rating.com.ua
Denis
Rudenko
DRudenko@credit-rating.ua
