12:33 01.04.2020

NBU Council approves sending of UAH 42.7 bln of its profit to national budget

2 min read
NBU Council approves sending of UAH 42.7 bln of its profit to national budget

The Council of the National Bank of Ukraine (NBU) at a meeting on Tuesday approved sending of 98.7% or UAH 42.7 billion of the central bank's profit for 2019 to the national budget, according to the decision of the meeting posted by NBU Council Head Bohdan Danylyshyn on his Facebook page.

"The NBU Council decided to approve the distribution of NBU profit for 2019... in the amount of UAH 43.303 billion, in the following areas: the formation of the NBU's total reserves of equity – UAH 580.769 million, the NBU obligations to the national budget of Ukraine – UAH 42.722 billion," Danylyshyn wrote.

As reported, in the state budget 2020, revenue from the National Bank was planned in the amount of UAH 40.709 billion, which is UAH 2 billion or 4.4% less than the revenue seen.

Last year, the NBU transferred UAH 64.878 billion to the national budget of Ukraine, which was a third more than expected.

During the meeting, the NBU Council also said that the actions of the central bank's board in December 2019, which led to an unpredictable increase in the money supply and an increase in the regulator's balance sheet liabilities at the end of the year, created fiscal risks for the budget and could negatively affect its performance.

According to the NBU Council, the negative impact was avoided thanks to measures taken by the Verkhovna Rada and amendments to the law on the NBU regarding the formation of general reserves.

At the same time, the Council believes that they only partially solve the existing problems, and therefore the recommendations of the body also contain a clause on the wider introduction of legislative amendments.

In addition, in the recommendations, the Council insists on granting it authority for consensus (together with the NBU board) management of the central bank's capital, including with regard to approving the capital management policy, deciding on the formation of capital reserves and analyzing the basis for their calculation.

The NBU Council called on the regulator's board to increase the level of reasonableness of decisions when conducting liquidity regulation operations and take into account their impact on public finances, as well as improve the provision of information on existing fiscal risks to the government.

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