Assessing the financial stability of a systemically important bank of Ukraine under martial law

Abstract

In conditions of prolonged martial law, ensuring the financial stability of the banking sector becomes of particular importance for maintaining the stability of the national economy and the financial security of the state. Systemically important banks play a leading role in ensuring the continuity of payment transactions, accumulation of financial resources, lending to business entities and implementation of state economic policy measures. At the same time, the increase in military risks, the deterioration of the financial condition of certain categories of borrowers, the increase in the level of uncertainty and the need to adapt to new economic conditions necessitate an in-depth study of the financial stability of systemically important banks in Ukraine. The purpose of the study is to assess the financial stability of JSC CB "PrivatBank" as a systemically important bank of Ukraine in conditions of martial law based on the analysis of capitalization, liquidity, profitability, asset quality and credit risk indicators, as well as to identify areas for further strengthening its financial stability. The research used a set of general scientific and special methods, in particular, methods of theoretical generalization and systematization - to study the economic essence of the financial stability of banks; methods of comparative and coefficient analysis - to evaluate the performance of the bank; economic and statistical methods - to study the dynamics of assets, capital, liabilities and financial results; methods of tabular data presentation - to summarize the results of the analysis; the method of integral assessment - to form a comprehensive characteristic of the bank's financial stability. The results of the study showed that during 2021-2025, JSC CB "PrivatBank" maintained a high level of financial stability, despite the difficult conditions for the functioning of the banking system during the period of martial law. A trend towards growth in the bank's assets, equity and resource base was established, which indicates the strengthening of its financial potential and the preservation of customer trust. It was determined that capital adequacy indicators consistently exceeded the regulatory requirements of the National Bank of Ukraine, which ensured the appropriate level of risk coverage at the expense of equity. It is proven that the bank maintained a high level of liquidity, as evidenced by the values of the N6, LCR and NSFR ratios, which significantly exceeded the established standards throughout the study period. It was found that the bank's profitability remained stable even in the face of military challenges, and the indicators of profitability of assets and capital were characterized by high values. At the same time, positive changes were found in the structure of the loan portfolio, which were manifested in an increase in lending volumes, a reduction in the share of non-performing loans and an increase in the level of credit risk provisions. The results of the integral assessment confirmed the high level of financial stability of the bank under study and its ability to adapt to the impact of military risks. Conclusions. It is proven that the financial stability of JSC CB "PrivatBank" in 2021-2025 was ensured by a combination of sufficient capitalization, excess liquidity, stable profitability, improved asset quality and effective credit risk management. The feasibility of further improving the risk management system, developing digital tools for monitoring the credit portfolio, diversifying active operations, and expanding the practice of stress testing taking into account military risks is substantiated. The results obtained can be used to increase the efficiency of managing the financial stability of systemically important banks and improve the mechanisms for ensuring the stability of the banking system of Ukraine in the face of modern economic challenges.