Functioning of the Banking System of Ukraine Under the Marital Law: Financial and Tax Aspects

Abstract

The article examines the dynamics of certain financial indicators of the banking system of Ukraine (income, expenses, net profit (loss)) after the start of full-scale military invasion. The basic  administrative and indicative instruments of the monetary policy of the National Bank of Ukraine, that allowed to ensure during this period the relative stability of the banking sector operating, are summarized. The dynamics of the composition and structure of income of the domestic banking sector (interest, commission, and others) were studied, the factors of their growth were analyzed, in particular, business lending, restoration of commission income, investments in NBU deposit certificates and other high-yield securities, reduction of deductions to reserves.The components of bank expenses (interest, commissions, general administrative, deductions to reserves, income tax, others) were studied, as well as certain factors influencing changes in their structure during the analysis period. The dynamics of revenues of the state budget of Ukraine during the research period were studied. The place of the ukrainian banking sector in the formation of state budget revenues was analyzed, both by transferring to the budget of the part of the income of the National Bank of Ukraine and taxation of financial corporations’ profit.Basing on the stable profitability of the country's banking sector during the analysis period, the forced expediency of increasing the income tax rate for banking institutions to reduce the deficit of the state budget of Ukraine in the current period is considered. Attention was focused on the necessity for the further increase of the efficiency of the Ukrainian banking sector both through the optimization of expenses, including the active introduction of online services, as well as the expansion of the offer of banking services, work with non-performing loans.