National Bank of Ukraine

Overview

The National Bank of Ukraine (NBU) serves as Ukraine's central bank and chief financial regulator, operating under conditions of extraordinary wartime pressure since the February 2022 full-scale Russian invasion. Andriy Pyshnyy assumed office as Governor on October 7, 2022, leading the institution through unprecedented challenges including capital controls, currency management, financial system resilience operations, and EU integration pathway maintenance. The NBU operates under expanded regulatory mandates, having assumed insurance supervision responsibilities from the National Commission for Financial Services in 2020.

The central bank maintains operational continuity and financial system stability despite active warfare, implementing critical functions including payment system operation, foreign exchange management, banking supervision, and AML/CFT enforcement. The NBU coordinates closely with international partners (IMF, World Bank, EU) on macroeconomic stabilization and post-conflict reconstruction planning.

Basic Identity

Classification

Inclusion Justification

What This Entity Oversees

The NBU exercises comprehensive banking supervision including:

Supervisory Scope:

• Commercial banks and credit institutions
• Foreign bank branches operating in Ukraine
• Licensing and de-licensing authority
• Prudential regulation and capital adequacy requirements
• Conduct of business standards

Wartime Supervisory Adaptations:

• Emergency support measures for systemically important banks
• Temporary forbearance on certain capital ratios during acute crises
• Expedited resolution procedures for failed institutions
• Enhanced liquidity provision facilities
• Payment continuity safeguards in conflict-affected regions

Supervisory Organization:

The NBU Board comprises the Governor, First Deputy Governor Serhiy Nikolaychuk (managing Financial Stability vertical), and five Deputy Governors overseeing Monetary Stability, Payment Systems and Cash Circulation (Deputy Governor Oleksii Shaban), and Finance, Administration and Operations (Deputy Governor Yaroslav Matuzka).

Enforcement Authority:

• Non-compliance sanctions
• Supervisory forbearance and remediation orders
• Mandatory remediation of governance and risk management deficiencies
• License revocation for serious violations

As of July 1, 2020, the NBU assumed supervision of non-bank financial services including:

Insurance Sector Supervision:

• Insurance company authorization and licensing
• Solvency and capital adequacy requirements
• Underwriting and reserve standards
• Consumer protection in insurance
• Claims handling oversight
• Insurance broker and agent regulation

Transfer from NCFSU:

Insurance supervision transferred from the National Commission for Financial Services and the Stock Market (NCFSU) to the NBU through legislative reform adopted by the Verkhovna Rada on September 12, 2019. The 10-month transition period concluded August 1, 2020, fully consolidating insurance regulation within the NBU.

Supervised Non-Bank Entities:

• Insurance companies
• Leasing companies
• Factoring companies
• Credit unions
• Pawnshops
• Other financial non-banking entities

The NBU establishes AML/CFT requirements and supervises compliance by regulated financial institutions. Key authorities:

Supervisory Framework:

• Establishment of AML/CFT regulations for banks and non-bank financial institutions
• Customer due diligence and enhanced due diligence requirements
• Suspicious transaction reporting and analysis
• Financial intelligence coordination

Coordination with SFMS:

The State Financial Monitoring Service (SFMS) functions as Ukraine's financial intelligence unit and primary AML/CFT authority, coordinating with:

• NBU regulatory requirements
• Sanctions enforcement (targeting Russian persons and entities)
• Cross-border transaction monitoring
• Beneficial ownership identification

Enforcement:

The NBU and SFMS impose sanctions for non-compliance including:

• Penalties for inadequate customer due diligence
• Sanctions for suspicious transaction reporting failures
• Administrative fines and remediation orders
• Restrictions on activities for serious violations

Wartime AML/CFT Challenges:

• Increased transaction volumes and complexity
• Humanitarian assistance monitoring
• Military financing and supply chain oversight
• Currency black market control
• Sanctioned entity identification in Ukrainian financial system

The NBU maintains financial system stability under extraordinary wartime conditions through:

Structural Measures:

• Emergency lending facilities for solvent banks
• Liquidity provision to payment system operators
• Deposit guarantee scheme maintenance
• Temporary forbearance on certain regulatory requirements
• Capital requirement flexibility during acute crises

Banking System Resilience:

Despite warfare and displacement, Ukrainian banks maintain:

• Basic payment system functionality
• Deposit acceptance in designated areas
• Transaction processing within capital control constraints
• Foreign exchange conversion services
• International transfer capabilities (limited)

Reconstruction Planning:

NBU coordinates with international partners on financial system recovery planning including:

• Post-conflict banking system restructuring
• Infrastructure rebuilding priorities
• Capital needs assessment
• Regulatory harmonization with EU standards
• Integration into European financial architecture

Regulatory Powers

The NBU exercises enforcement authority through:

Supervisory Sanctions:

• Non-compliance warnings
• Remediation and capital adequacy orders
• Business line restrictions
• Transaction processing limitations
• License suspension and revocation

Administrative and Judicial Processes:

• Appeals of enforcement decisions through administrative courts
• Judicial review of supervisory determinations
• Publication of enforcement actions for market transparency
• Graduated penalty system based on violation severity

Regulatory Role and Function

Decision-Making Bodies:

• Governor: Andriy Pyshnyy (appointed October 7, 2022)
• First Deputy Governor: Serhiy Nikolaychuk (manages Financial Stability vertical)
• Deputy Governors:
• Monetary Stability
• Payment Systems and Cash Circulation: Oleksii Shaban
• Finance, Administration and Operations: Yaroslav Matuzka
• Council of the National Bank: 15 members including Governor ex officio

Regulatory Divisions:

• Banking Supervision Department
• Payment Systems Department
• Financial Monitoring and AML/CFT
• Insurance and Non-Bank Financial Services Supervision
• Monetary Policy Department
• Currency and Foreign Exchange Department

Legal Foundation

Primary Legislation:

• Constitution of Ukraine
• Law of Ukraine "On the National Bank of Ukraine" (dated May 20, 1999)
• Law of Ukraine "On Banks and Banking Activity" (dated December 7, 2000)
• Law of Ukraine on Emergency Measures (Martial Law decrees, 2022-present)

Historical Context:

The modern National Bank of Ukraine was established following Ukraine's independence in 1991. The Verkhovna Rada (Parliament) adopted the resolution "On Banks and Banking Activity" on March 20, 1991, which declared state ownership of the Ukrainian Republican branch of Gosbank and renamed it the National Bank. The two-level banking system (central bank plus commercial banks) was formally established through this legislation, with operations commencing May 1, 1991.

The 1999 Law on NBU established modern governance structures, independence frameworks, and regulatory authority. The 2000 Law on Banks and Banking Activity defined prudential regulation, bank charter requirements, and supervisory procedures applicable to the current banking system.

Wartime Legal Modifications:

Multiple decrees and laws implemented emergency modifications to financial regulations including capital controls, payment restrictions, and emergency lending facilities to maintain financial system functionality during active hostilities.

Sources:

• The Law of Ukraine on the National Bank of Ukraine
• Law of Ukraine on Banks and Banking
• National Bank of Ukraine - Wikipedia

Licensing and Authorization Relevance

The National Bank of Ukraine is a key licensing authority in Ukraine's financial system:

The licensing process typically involves assessment of capital adequacy, fitness and propriety of management, business plan viability, AML/CFT compliance frameworks, and IT systems readiness.

Payments and Money Movement Relevance

The NBU conducts monetary policy aimed at price stability and currency stability under extraordinary wartime conditions. Key policy frameworks:

Key Policy Rate:

• Main policy instrument: base rate on the NBU board rate (adjusted quarterly and ad-hoc as conditions warrant)
• Transmission mechanism through interbank lending and deposit facilities
• Current focus on fighting inflation exacerbated by wartime economic disruption

Operational Objectives:

• Anchoring inflation expectations within target band despite war-related supply shocks
• Managing hryvnia exchange rate to prevent currency collapse
• Maintaining adequate foreign exchange reserves
• Supporting banking system liquidity during disruptions

Challenges:

Wartime monetary policy operates under structural constraints including limited tax revenues, emergency central bank financing, population displacement affecting money demand, and commodity supply shocks. The NBU targets inflation at 5% medium-term while managing quarterly volatility driven by military operations and international commodity prices.

The NBU operates and regulates Ukraine's critical payment system infrastructure:

System of Electronic Payments (SEP)

SEP is an RTGS-class (Real Time Gross Settlement) systemically important payment system handling both large-value interbank transfers and retail payment processing. Key characteristics:

System Evolution:

• Previous system: multi-tier settlement with daily batch processing
• New-generation SEP: operational since April 1, 2023
• Standards compliance: ISO 20022 global standard adoption
• Message schemes: based on SCT (SEPA Credit Transfer) standards
• Operating schedule: 24/7/365 continuous operations

Operational Resilience (Wartime):

Since February 24, 2022, SEP has continued operating with "reliability before and after the full-scale war" despite significant challenges including:

• Regional infrastructure damage in conflict zones
• Temporary loss of bank branch connectivity
• Backup site activation and redundancy protocols
• Remote operation accommodations for displaced personnel

SEPA Integration Pathway:

Introduction of instant payments targeted for completion by end-2024, aligning with EU accession requirements. Instant payments infrastructure enables Ukraine to join SEPA (Single Euro Payments Area) following EU membership, positioning Ukraine for post-conflict financial integration.

Cash Circulation

The NBU manages hryvnia (UAH) currency issuance, circulation, and physical currency operations. Wartime challenges include:

• Currency demand management across active conflict zones
• Logistics for cash delivery to unstable regions
• Counterfeiting prevention under wartime conditions
• Currency wear and replacement programs
• Digital currency development initiatives

The NBU implements foreign exchange regulations and capital control measures intensified post-2022 invasion:

Capital Control Framework:

Capital controls aim to prevent capital flight, stabilize the exchange rate, and preserve scarce foreign exchange reserves. Key restrictions:

Resident Outbound Transfers:

• Limit on cash withdrawals within Ukraine: UAH 100,000 per day per client (exceptions: payroll payments and specified purposes)
• Cash withdrawal limit for UAH accounts abroad: UAH 12,500 per seven-day week
• Limit on dividend repatriation: EUR 1 million monthly (introduced 2024)
• Restrictions on debt repayment abroad
• Licensing requirements for most outbound transfers

Liberalization Trajectory:

In 2024, the NBU introduced the largest FX restrictions easing package since the start of full-scale war, with the purpose of:

• Improving business conditions for operating in Ukraine
• Promoting expansion of local companies abroad
• Facilitating post-conflict economic recovery preparation
• Balancing capital flight prevention with economic growth

Floating Exchange Rate Regime:

• UAH floats against USD, EUR, and other major currencies
• NBU maintains FX reserves for intervention in extreme volatility
• Reference rates published daily for accounting and reporting

Payment Systems Governed or Overseen

The Національний Банк України (National Bank of Ukraine) operates and/or oversees the national payment and settlement infrastructure of Ukraine. As of 2026, the key payment systems include:

Core Infrastructure Systems

SEPA Integration and Development

Domestic Digital Payment Ecosystem (Wartime Operations)

Retail Payment Methods:

• Bank-operated mobile wallets (adapted for wartime usage)
• Digital payment services through surviving banking infrastructure
• Card-based payments where functional
• E-banking services where infrastructure permits

Key Challenges and Adaptations:

• Continued operation under extraordinary circumstances
• Infrastructure resilience and backup systems
• Consumer protection maintenance during conflict
• Regional payment system reconstruction

Settlement and Clearing Infrastructure (Wartime Context)

NBU Settlement Function:

• Operator: Національний Банк України (Central Bank of Ukraine)
• Settlement Authority: Direct settlement through NBU central bank accounts
• Settlement Currency: Ukrainian Hryvnia (UAH) for domestic transactions
• Participant Banks: Licensed Ukrainian banks and payment service providers (operational capacity)

Operational Status:

• Payment system operations continuing under wartime conditions
• Infrastructure adaptation and redundancy measures
• Coordination with IMF and international partners
• Gradual reconstruction efforts

Regulatory Framework (Wartime Adaptation)

Legislation:

• Law on the National Bank of Ukraine: Primary authority for payment system regulation
• Financial Services Act: Comprehensive financial regulation (adapted for wartime)
• EU Alignment Program: Long-term SEPA standards harmonization (post-war planning)
• Wartime Financial Regulations: Emergency measures for financial system continuity

Settlement Finality:

Національний Банк України maintains binding rules for payment finality and settlement to ensure legal certainty within wartime operational constraints.

EU Integration Pathway

Official EU Candidate Status (granted 2022):

• Ukraine pursuing full EU membership following conflict resolution
• Payment systems alignment with SEPA standards as priority (Dec 2025 status)
• Regulatory harmonization with EU banking directives (CRD, CRR) - long-term
• Central bank independence and accountability requirements

SEPA Alignment Program:

• Legislation development for SEPA compliance (ongoing as of Dec 2025)
• Long-term integration planning with European payment infrastructure
• Gradual transition toward euro payment standards integration
• Post-reconstruction payment system modernization

Digital Currency and Innovation

CBDC Research:

• National Bank research on digital hryvnia potential
• Post-conflict financial system modernization planning
• Coordination with international central banking standards

Open Banking Development:

• Long-term PSD2 implementation planning
• Third-party payment service provider integration roadmap
• Digital payment ecosystem modernization vision

Cross-Border Integration

International Cooperation:

• IMF engagement on macroeconomic stabilization (ongoing)
• World Bank assistance for financial system development
• BIS coordination on central banking standards
• EU integration pathway support

Regional Cooperation:

• Coordination with neighboring central banks
• Bilateral payment system coordination (where functional)
• Regional financial stability initiatives

Future Regulatory Enhancements (Post-Reconstruction)

Scheduled Long-Term Initiatives:

• SEPA integration and compliance achievement (post-war timeframe)
• SEPA Instant participation development
• Enhanced cybersecurity standards implementation
• Open banking API standardization
• Digital payment infrastructure modernization

Infrastructure Reconstruction:

• Payment system resilience enhancement
• Cross-border instant payment capability development
• Consumer protection framework update
• Fintech ecosystem development

Post-War Financial System Modernization:

• Complete alignment with EU payment system standards
• Potential euro adoption pathway preparation
• Digital financial services ecosystem development
• International financial integration

Wartime Humanitarian Context

Financial Services for Civilian Population:

• Maintenance of essential payment services for civilian needs
• Banking access for government services and benefits
• International remittance corridors
• Cross-border payment support for displaced persons

Sources:

• SEPA Countries List 2026
• SEPA Zone Countries - Stripe
• SEPA Countries List (Updated 2025)
• SEPA Zone Overview - GoCardless
• SEPA Payments Guide - Atlar

Relationship to Other Regulators

EU Accession Pathway:

Ukraine progresses toward EU membership with regulatory harmonization priorities including:

• Alignment of banking supervision with EU directives (CRD, CRR)
• Payment system standards integration (SEPA)
• AML/CFT compliance with EU and FATF standards
• Financial services market regulation harmonization
• Central bank independence and accountability frameworks

International Cooperation:

• IMF engagement on macroeconomic stabilization programs
• World Bank assistance for financial system development
• BIS coordination on central banking standards
• FATF compliance with AML/CFT standards (under review)
• Bilateral central bank cooperation with EU and other democracies

Wartime International Support:

• Official development assistance coordination
• Humanitarian financing mechanisms
• Emergency liquidity support arrangements
• International asset freezes on Russian accounts (cooperation with partners)

Geography and Jurisdiction Notes

Important Departments and Divisions

Key Public Resources

Headquarters:

National Bank of Ukraine

9 Instytutska Street

Kyiv 01601

Ukraine

Official Communications:

• Website: https://bank.gov.ua/en
• Press Office: [email protected]
• Telephone: +380 44 277-3011

Supervision Contacts:

• Banking Supervision Division
• Payment Systems Department
• Financial Monitoring Service (SFMS coordination)

Notes on Naming and Language