BANKING REGULATION WITHIN THE SYSTEM OF STATE ADMINISTRATION OF BANKING ACTIVITY

Abstract

The necessity and rationality of certain legislative changes in the sphere of banking regulation in the system of state administration of banking activity have been noted, particularly it has been emphasized on the effectiveness of regulating the normative and legal base by: exclusion of regulations of currency positions and establishment of flexible exchange limits instead of them that allows the National Bank of Ukraine to regulate the level of currency risks in accordance with the conditions of the international currency market and the financial and economic situation in the state, and banks to carry out in advance the adjustment of strategies; exclusion of regulations in the correlation of regulatory capital to the duties and total assets and establishing the norm of the main capital adequacy instead of them that allows to avoid their duplication with the regulation of regulative capital adequacy; exclusion of the regulation of the maximum total amount of loans, guarantees and warranties granted to insiders was necessary due to its duplication of the regulation of the maximum amount of credit risk on transactions with entity related to a bank.

It has been emphasized on the irrationality of the exception pf the regulation of the maximum amount of loans, guarantees and warranties granted to one insider, which led to the inability to assess and minimize the risks associated with credit transactions with a separate entity related to a bank. That is why there is a need for establishing the regulation H10 “The regulation of the maximum amount of credit risk on one entity related to a bank”. The author has also offered to establish the efficiency standards of using assets (H14 and H14-1) that ensure the stability of banks, support of their reliability and stimulate economic growth.