Theoretical Substantiation of Profit Sources and Assessment of the Banking System's Potential for Financing Digitalization in Ukraine

This paper analyzes the phenomenon of digitalization as a key driver of progress, shaping a unified digital space and modernizing the fundamental paradigm of societal development. The theoretical underpinnings of value creation of digitalizing banking services are substantiated. An assessment of the potential of the domestic banking system is conducted based on the dynamics of LCR, return on equity, profitability, business efficiency, and capital adequacy ratios of Ukraine's systemically important banks. The analysis results confirm the accumulation of sufficient financial resources by the banking system to financially support processes aimed at developing the digitalization of financial relations in Ukraine. Modeling banks' ability to further accumulate financial potential, taking into account the business expectations index, changes in operating income, and cost regulation, and considering the need to comply with regulatory requirements, was carried out. This made it possible to assert a high level of such capacity in banks such as PrivatBank, Credit Agricole, and Ukrsibbank. The presence of a high potential for increasing the financial potential of the development of the digital space at the expense of banking capital is proven. To utilize it for digitalization in Ukraine, appropriate conditions must be formed, primarily, financial stability must be maintained and a system of state incentives and guarantees for investment during periods of high risks of wartime must be developed.