Ukraine's NBU notes growing macroeconomic risk, capital risk in its financial stability report

MOSCOW. June 19 (Interfax) - Assessments of macroeconomic risk and capital risk in Ukraine increased by one point on the scale from zero to ten due to the widening of the current account deficit in the balance of payments and new capital requirements, respectively, according to the financial stability report released by the National Bank of Ukraine (NBU) on Wednesday, Ukrainian media outlets said.

According to the report, other factors, which influenced the growth of macroeconomic risk from seven to eight points, include a slowdown in the recovery of the economy due to issues in the energy sector and a still high ration of the state budget deficit and the external and public debt to GDP.

"Substantial international support weakens these risks," the NBU said.

As for capital risk, which increased from five to six points, the NBU pointed out that its growth is due to a decline in bank's capital adequacy caused by the tightening of capital requirements, in particular, the complete accounting for operational risk.

"At the same time, the sector's capital stock remains considerable due to high profitability and restrictions on its distribution. Therefore, capital risk remains average," the report said.

Other risks remained the same, namely, credit risk for individuals standing at four points, for corporations at five, foreign currency risk at four, system liquidity risk at two, and profitability risk at one.