The Road to European Integration: Experts Assess the Benefits to the Ukrainian Banking Sector of Approximation to International Financial Systems

Improved asset quality, better lending conditions, and the return of a high level of confidence in the banking system are the main benefits of the approximation of the Ukrainian banking system to European standards.

"Integration of the Ukrainian banking financial system, in particular into the European one, into European standards, will certainly make the Ukrainian financial system more reliable, with fewer risks and will even raise the overall credit rating of Ukraine, even with full integration into European standards," economic expert Andriy Novak said in a commentary to UNN.

The expert notes that even those Ukrainian banks that survived the bank collapse did not become more attractive to foreign investors, but approximation to European standards will change the situation. This is one way to restore reputation and increase confidence in the banking system.

Integration with international financial systems, i.e., convergence with European financial standards and practices, can increase Ukraine's attractiveness to foreign investors - one of the elements that will help to increase the stability, transparency and efficiency of the Ukrainian banking system, believes Olena Sosedka, co-founder of Ukraine's first fintech ecosystem Concord Fintech Solutions.

Economic expert Viktor Medvid also emphasized the importance of integration into the international financial system. In particular, he noted that the cost of loans abroad is lower, but the valuation of bank assets will increase if integration takes place. Medvid warns against the takeover of the domestic banking system, which will benefit only international institutions.

"And if it is a mutual integration, i.e., when the authorized capital includes partially some international financial institutions, etc., these are the strategies of Privat and Oschad. They want to sell stakes to the EBRD, and then they can enter the market and be funded, and the EBRD is an indicator of a quality asset. Then yes, it is possible. But it is always important how the task is achieved. If it is achieved through the rational sale of the equity value, yes. If you sell a stake in a bank for 3 kopecks, or 10% of its real value, it is not good just to say that we have integrated," the expert believes.