Specific features of the financial system of Ukraine in the conditions of war

Abstract

The impact of a range of factors on the country’s financial system, primarily related to the war, determines the relevance and importance of conducting this study. In modern conditions, the sphere of finance is transformed and adapted, therefore the purpose of this study was to investigate the current state of the country’s financial system in the context of the functioning of its main structural elements. The methodological basis of this study included the use of both general scientific methods, such as analysis, synthesis, comparison, comparison, and specific methods. To detect existing trends and processes in the financial system of Ukraine, statistical methods of dynamic and structural analysis were used. The study used a complex approach to the investigation of the financial system, specifically, the budget sphere, the banking system, the securities market, and the currency sphere were analysed. The main processes that affect the formation and implementation of the revenue and expenditure part of the state budget have been identified. The volume of tax revenues and their share in the formation of state budget revenues in the pre-war and wartime periods were compared. The main reasons for the growth of the budget deficit have been identified. The key sources used to cover the deficit were highlighted. The state of the national securities market was described based on the analysis of the structure of trade transactions in terms of financial instruments. The study found that the main share of trade transactions takes place with government debt securities. The banking sector, the financial system of the country, based on indicators of liquidity and profitability, was studied. Using the stability rating of banking institutions, it was found that leading positions in it are occupied by financial institutions that have foreign sources of financing, as well as state banks. The dynamics of devaluation of the hryvnia with the dynamics of inflationary processes were investigated. The results of the study allow for a comprehensive assessment of the current state of the country’s financial system and will be useful both to actors in the country’s financial sector and to managers who determine the basis of its functioning