Vladyslav Rashkovan, the National Bank of Ukraine's director of department for banking system strategy and reform, said at a working last Thursday that the domestic banking system requires urgent changes.

"Recent developments in the banking sector clearly demonstrate that it faces serious structural problems," Rashkovan said. "However, the banking community should respond to these challenges in a strategic and effective manner. The tactical approach to addressing the challenges faced by the banking sector that provides only a temporary solution to the problem is no longer working. Devising the Development Strategy for the next three to five years will require a broader approach."

Participants in the session included members of the Board of Ukrainian banks and representatives of the Banking Committee of the American Chamber of Commerce, the Finance Committee of the European Business Association and the Forum for Leading International Financial Institutions, among others.

They discussed corporate governance, monetary adjustment, infrastructure and sustainable development of financial institutions, protection of the rights of creditors and depositors, expansion of financial markets' toolkit, measures to ensure the efficient banking supervision and ways to overcome long-standing obstacles to reform.

"As experience shows, bankers and the National Bank of Ukraine officials see eye to eye on issues of systemic importance. Therefore, close cooperation between the regulator and the banking community appears logical," Rashkovan said. "By providing a platform for discussion, the National Bank of Ukraine offers the banking associations a unique opportunity to maintain a dialogue and exchange views. We hope that this dialogue will be the first step towards achieving consolidation in the banking associations. We have to make every effort to approve the so called roadmap for the banking system so that the market is aware of which way to go."

He said the participants had successfully identified the key areas to focus on when devising the development strategy for the Ukrainian banking sector until 2020: the consolidation of the efforts of banking associations, mitigation of risk concentration arising in banks' operation, development of rehabilitation lending, the expansion of cashless settlements, increased operations processed through the domestic payment system and improvement of monetary policy.