The National Bank of Ukraine under the conditions of marital law: the efficiency of actions on the capital markets

Abstract

Introduction. The introduction of martial law creates new challenges for financial market regulators, primarily in terms of maintaining the liquidity of financial intermediaries and trust in the national currency. Problem Statement. The results of the monetary and currency policy of the National Bank of Ukraine (NBU) on the eve of the introduction of martial law made it possible to prevent uncontrolled inflation, continue the movement towards currency liberalization, create prerequisites for the activation of the economy and achieve macro-financial stabilization. However, currently the NBU is forced to promptly implement a set of measures to stabilize the financial sector. Purpose. To assess the effectiveness of the NBU\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\'s actions on the capital markets on the eve and in the first months of the war in Ukraine, to assess the mechanisms for supporting the liquidity of financial institutions, as well as the expediency of regulatory restrictions and their impact on the investment attractiveness of government bonds. Methods. Economic-statistical and mathematical-statistical methods are used to determine absolute and relative indicators of the level and dynamics of market development, comparison, descriptive method, analysis, generalization and induction. An abstract-logical method was used to formulate the conclusions. Results. The sequence and tools of the central bank regarding the support of banks\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\' liquidity have been defined. The dominant role of domestic loan bonds in the domestic financial system is substantiated. The pricing of local government bonds of Ukraine in crisis conditions is much more controlled and predictable than that of Eurobonds, the circulation and main owners of which are concentrated mainly in foreign markets. The NBU pursues a balanced policy in order, on the one hand, to maintain the stability of the financial system, and on the other hand, not to hinder the recovery of economic processes. The inadequacy of financial instruments allowed for circulation (military bonds) for investment activities, diversification of portfolios of financial institutions and meeting the demand of mass investors is substantiated. Conclusions. The consistent and predictable position of the NBU, balanced monetary and regulatory policy made it possible to ensure the stability of the financial system. The central bank is gradually relaxing the requirements introduced at the beginning of the aggression. Restrictions of the National Capital Markets Fund on areas of activity and instruments on the capital markets remain a restraining factor for the recovery of investment activity. They apply not only to securities of private issuers, but also to most government bonds, on the liquidity and investment attractiveness of which depend the attraction of resources to counter external aggression, the stabilization of budget policy, as well as the activities of financial institutions, including entities regulated by the NBU.