The NBU has announced plans to conduct a stress test for banks in 2025.
According to Ukrinform, this was reported by the press service of the National Bank.
“After a four-year hiatus, the assessment of the resilience of banks and the banking system will be conducted using the standard procedure, involving external auditors to evaluate asset quality and applying an unfavorable scenario within the stress testing framework,” the statement reads.
It is noted that the assessment will consist of three stages:
- evaluation of asset quality by independent auditors,
- extrapolation of the results,
- stress testing of the largest banks under baseline and unfavorable scenarios.
In particular, the third stage, or stress testing, will cover the largest banks based on the volume of individual deposits, risk-weighted assets, and the volume of individual loans, as well as banks that required capitalization following the resilience assessment in 2023. This will ensure coverage of over 90% of the net assets of the banking system.
The resilience assessment will be conducted as of January 1, 2025.
According to the schedule, in December 2024, the NBU will approve the technical assignment and the list of banks for stress testing, and by the end of April 2025, auditors are expected to complete the asset quality assessment. By August 10, the NBU will approve the assessment results and, if necessary, send banks requests for the preparation of capitalization/restructuring programs.
As previously reported, the resilience assessment of banks in Ukraine was conducted annually since 2018, except for the years 2020-2022. After a break, the assessment was resumed in 2023 as of April 1, but with several specific features. According to the results of this assessment, most banks in Ukraine had sufficient capital, and the banking system as a whole exhibited a high level of resilience.