Banking system and international trade in Ukraine during the financial crisis

Abstract

Deposit insurance schemes are primarily inte nded to reduce the risk of systemic failure of banks and, hence, to stabilize the payments and financial system. This paper focuses on present analysis of some problematic aspects of the banking system and deposit guarantee system in 2014-2016. There is a problem of effective functioning of the banking and deposit insurance system under the current economic circumstances. The article presents an information about the number of households’deposits in the banks-members of the Deposit Guarantee Fund. It has been emphasized a decreasing influence of banks’ deposit base on the Ukrainian economy and the negative trend on savings. We have also analyzed a ratio of savings to the Gross Domestic Product. Our paper pointed to an importance of overseas money transfers. The paper is concerned with a level of dollarization of deposits and the structure of deposits in banks. It has been outlined the existence of a correlation between fluctuations in foreign currency and total amount of deposits. The paper further indicates on the dynamics and structure of liabilities in banks-members of the Deposit Guarantee Fund. The percentage of the households’ deposits has been significantly reduced. We have also analyzed the dynamics of crediting and total non-performing loans in the Ukrainian banking system. Submitted TOP 10 banks by the National Bank of Ukraine’s refinancing loans. The results of our study present some recommendations how to improve the performance of the Deposit Guarantee Fund. We also indicated the importance to improve the depo sit guarantee system in Ukraine.